UPDATE: After being increased to 50% it was then reduced to 35% with a maximum rebate of 500,000 points, which is where we stand today.
Earlier in the year American Express announced that as of July 1, 2015, they’ll be eliminating the 20% “Pay With Points” rebate which they currently offer on The Business Platinum® Card from American Express.
Basically American Express lets you redeem each Membership Rewards point for one cent towards the cost of a paid airline ticket. However, with the 20% rebate being offered by the card, it was the equivalent of getting a value of 1.25 cents per Membership Rewards point. That’s still not a very good value, in my opinion.
That’s why I didn’t view it as much of a loss, since you can earn a lot more value out of Membership Rewards than 1.25 cents per point.
However, it looks like American Express will be introducing a replacement benefit for the The Business Platinum® Card from American Express (this does not apply to the personal Platinum Card).
As of July 1, 2015, you can get 30% Membership Rewards points back when you use the Pay with Points feature for all or part of a flight with the airline you select.
The “airline you select” will be the same one you designate as your airline for the purposes of the annual $200 airline fee credit. In other words, the value per point is actually improving, though you’re limited to just one airline.
So while you’d essentially get 1.25 cents of airfare per Membership Rewards point under the old system, you’ll get ~1.43 cents of airfare per Membership Rewards point under the new “Pay With Points” benefit. That’s still not a rate at which I’d personally redeem Membership Rewards points, though it’s certainly better than before, and closer to what I’d consider to be a “fair” value.
Ultimately there’s nothing wrong with wanting to earn points you can redeem towards the cost of a paid ticket, though then it makes sense to get a card which actually offers a good return on that.
For example, the Barclaycard Arrival® Plus World Elite Mastercard® offers the equivalent of ~2.1% cash back towards the cost of air travel, while there are no annual fee cards like the Citi® Double Cash Card, which offer the equivalent of a straight 2% cash back with no annual fee (1% cash back when you buy, plus 1% cash back as you pay for purchases).
For a “focused” redeemer I’d consider this change to be a net positive, since you’re ultimately getting a higher return with a single carrier as opposed to a lesser return with any carrier.
While I’m a big fan of American Express’ Platinum Cards (both business and personal), I like them for the benefits they offer, and not for the actual return on everyday spend. This includes benefits like:
- $200 annual airline fee credit
- $100 Global Entry/Pre-Check fee credit
- Access to Boingo hotspots
- Access to American Express Fine Hotels & Resorts
- Access to Delta SkyClubs
- Priority Pass Select membership
- Access to the American Express Centurion Lounges in Dallas, Las Vegas, New York, San Francisco, etc.
- 10 complimentary Gogo wifi passes annually
For my spend where I want to earn Membership Rewards points, I’d much rather spend on the Amex EveryDay® Preferred Credit Card and American Express® Gold Card, given that they offer a better return thanks to their lucrative category bonuses.
Would you redeem Membership Rewards points for ~1.43 cents each towards the cost of a paid airline ticket?