I don’t want to be an alarmist, but am I the only one who thinks we might be at a point where transferable points currencies are starting to change for the worse?
In this post:
Why transferable points could become less valuable
For those looking to earn travel rewards with credit cards, it generally makes the most sense to collect transferable points currencies, which can efficiently be transfered to a variety of airline and hotel partners. This gives you the most flexibility, since you don’t have to commit to any one currency, and it also shields you as much as possible from any program specific devaluations.
The transfer ratios when moving points from transferable points currencies to travel partners varies, given that not all rewards currencies have the same value. The most common ratio is 1:1, but that’s not consistently the case. Keep in mind this is also because credit card companies pay different amounts for different points currencies.
Broadly speaking, transferable points typically transfer to travel partners at a ratio of 1:1, or sometimes even more. There are of course exceptions, and not all rewards currencies are created equal. It seems that many transferable points currencies have wanted to maintain a 1:1 transfer ratio as one of their main selling points. However, in recent times, we’re starting to see a reverse of that trend:
- Recently, we saw most major transferable points currencies devalue Emirates Skywards transfer ratios, and Chase Ultimate Rewards removed Emirates Skywards as a transfer partner (presumably because it wants to maintain a 1:1 ratio with all partners)
- As flagged by Danny the Deal Guru, as of March 1, 2026, the Amex Membership Rewards to Cathay Pacific Asia Miles transfer ratio will be devalued from 1:1 to 5:4, so this wasn’t just an isolated incident specific to one partner
As of now this isn’t a widespread situation, but I can see this becoming a more common problem, because once the practice is normalized, it’s much more likely to spread. Let me explain…
Factors that could drive this change to points currencies
I have no inside information here, but I fear that this could be the start of a bigger trend, and that we’ll soon see transfer ratios with these programs being all over the place. As I view it, this comes down to two different factors.
For one, we’re increasingly seeing (particularly airline) loyalty programs get savvier when it comes to how they’re monetized. Partner award availability is becoming increasingly rare, as airlines want to focus exclusively on their own programs, and monetize them efficiently. For those programs that partner with transferable points currencies, it also seems to me like many of those programs may want more money, when it comes time to renew their contracts.
Ultimately if a loyalty program wants more money from one of the credit card companies, either the credit card company has to eat that extra cost, or that has to be passed on to consumers, in the form of a worse transfer ratio.
At the same time that all of this is happening, it also seems that credit card companies are trying to limit their costs associated with their own points currencies:
- We’ve seen Amex add restrictions to its “Pay With Points” option for its most premium cards, essentially limiting the “cash out” value of those rewards toward flights
- We’ve seen Chase get rid of 1.5 cents per point redemptions for virtually any travel purchase on its most premium cards
- With Citi, you can’t even cash out points anymore for 1.0 cents each for most of the rewards cards earning ThankYou points
So when you combine airline loyalty programs wanting more money for their transferable points, with credit card companies trying to limit their costs of redemptions, it sure seems to me like this might (unfortunately) be the start of a bigger trend.
Of course that would be frustrating. At the same time, we can earn more points from credit cards than ever before, between sign-up bonus and spending multipliers, so it’s not like consumers are left without choice, or decent redemption options. Understandably, card issuers don’t want to change their bonus multipliers to essentially recalibrate things, so the next best option is to just make each point worth a bit less.
We’ll see how this all plays out, and I hate to make predictions like this, but I wouldn’t be surprised if a couple of years from now, transfer ratios are just all over the place, with 1:1 no longer being the standard.
Bottom line
It definitely seems like transferable points currencies are going to be facing some cost pressure in the near future. It feels like airline loyalty programs want more money from partners for their points, while credit card companies are also trying to limit their costs on redemptions. That’s a combination that seems like it can only go in one direction.
I don’t want to predict bad news here, or to extrapolate something that isn’t there. However, I think we’ve gone from “one-off” territory (with the Emirates Skywards transfer ratio being devalued), to maybe the start of something bigger. We’ll see how this all plays out, though I’ve gotten my prediction in…
Do you think we’re at an inflection point with transferable points currencies, or am I reading too much into this?
Is breaking the buck in a money market fund also an "inflection point?" Yes, but credibility matters and Amex now has none.
Ben you are not an alarmist. Airlines and Hotels have already made a move to scoop up points, like a vacuum.
There are hotels that demand 300,000 to over 1 million points PER NIGHT !
Airlines are in the same financial position, they want those points in their hands, not ours.
It is sad for the dedicated and loyal travellers of these companies, that we are getting the shaft.
Thats life until it changes.
Inflection point? No.
Is there going to be some negative news in the short-to-medium term? Yes. I think CX and EK both have an established business that is less dependent on brokering miles. In the case of CX, there is just not enough premium capacity to meet demand over the Pacific.
Demand ebbs and flows, and I also think there will be new airlines and new programs interested in driving engagement. We've seen JAL...
Inflection point? No.
Is there going to be some negative news in the short-to-medium term? Yes. I think CX and EK both have an established business that is less dependent on brokering miles. In the case of CX, there is just not enough premium capacity to meet demand over the Pacific.
Demand ebbs and flows, and I also think there will be new airlines and new programs interested in driving engagement. We've seen JAL added this year by 2 programs. Vietnam, Hainan, and Air India have started to partner with some folks. We've also seen some new entrants on the Hotel loyalty front (Preferred and Omni).
It is likely that the nicest products are going to be walled gardens (it seems most of the 1st class cabins are going that direction), and I think more hotel programs are going to be locking up the aspirational redemptions that are the subject of so many TikTok videos. But there will still be plenty of airlines looking to use mileage redemptions to drive engagement or to recover some revenue on expiring inventory. There are a lot of hotels (both chain and independent) that need to sell rooms at a discount without dropping the price on the website. I've never had a problem finding what I need at a good price, but I also am not chasing specific products -- I'm looking to go places in relative comfort.
this is a good, well thought out comment. i wish i was as optimistic as you though lol
I think it's inevitable. As credit card rewards programs get more publicized by third parties, blogs, Youtube, Reddit it's way easier to identify and exploit points of value and encourage others to do the same. Offers also generally can't be segregated- you can't offer a special bonus only on a flight and expect it to be isolated to that audience. Savvy rewards enthusiasts are taking the more expensive offers.
Additionally, as it's now MORE...
I think it's inevitable. As credit card rewards programs get more publicized by third parties, blogs, Youtube, Reddit it's way easier to identify and exploit points of value and encourage others to do the same. Offers also generally can't be segregated- you can't offer a special bonus only on a flight and expect it to be isolated to that audience. Savvy rewards enthusiasts are taking the more expensive offers.
Additionally, as it's now MORE expensive to tell people to call in and book with an agent, modern web UIs for airlines now need to make it possible to see rewards flights at a glance- it's far easier to discover the good redemptions.
Availability+transparency= doom for rewards programs. You can't have insane redemptions easily found and not expect that to end badly.
what do you expect with all these 100K sign up bonuses to any tom dick and harry who has a pulse and a 600 credit score?! you got parents signing their 6 kids up at 100K a pop and trying to put everyone in business class on their summer flight to Europe.
There has been a major decline in award space, value, and sweet spots. As good as this blog is, this and many...
what do you expect with all these 100K sign up bonuses to any tom dick and harry who has a pulse and a 600 credit score?! you got parents signing their 6 kids up at 100K a pop and trying to put everyone in business class on their summer flight to Europe.
There has been a major decline in award space, value, and sweet spots. As good as this blog is, this and many others are the primary reason for the downfall. Everyone and their brother got in on the "points" game to "fly for free"... Here we are. The points are not worth what we think they are.
Greed is good!
What is going to happen when V/MC/Ax processors start raising merchant fees for points cards over standard ones?
I never find value in using points except international business class. And that's real value because I would buy the tickets if I couldn't use points.
Unfortunately, points hoarders in America have ruined travel around the world for the rest of the global population. Especially Instagram influencers, TikTok muppets and sites like the Points Guy.
This reset is much needed. I look forward to flying again without people shouting and filming the whole f***ing flight.
Tell us about a time you were on a flight with a travel blogger filming and shouting the whole flight.
This is the inevitable outcome of AMEX was allowing people to have 5 or 6 Plat Business cards simultaneously, each with 150,000 mile sigh-up bonuses, back in 2020-2021. All of the transfer rates will be devalued to 5:4 or worse sooner than later. Insane as it sounds, I may end using our points on the "worst of all options," Delta, since I would like to reach 3 MM for lifetime Diamond in the next few...
This is the inevitable outcome of AMEX was allowing people to have 5 or 6 Plat Business cards simultaneously, each with 150,000 mile sigh-up bonuses, back in 2020-2021. All of the transfer rates will be devalued to 5:4 or worse sooner than later. Insane as it sounds, I may end using our points on the "worst of all options," Delta, since I would like to reach 3 MM for lifetime Diamond in the next few years. Maybe Delta won't end up looking so terrible when all is said and done. Time will tell. As long as the value obtained is at least 1.538 cpp using the AMEX Plat Business card 35% rebate, it really isn't so awful. Flying on a single award from US to Asia in DL A350-900 business class is better than taking positioning flights to catch almost any other carrier.
I really wish Amex hadn't nerfed that 35% rebate this year :(
It feels like a lot of the worst practices (outside Bonvoy) are happening with airlines, and coincidentally airlines operate as regional monopolies in a lot of markets. What choice do you have but United if you live near Houston, Denver, etc.? Or Delta in Atlanta or Salt Lake or Minneapolis? Low cost carriers don't have much in the way of a loyalty program, so you don't really see United and Delta competing on the value...
It feels like a lot of the worst practices (outside Bonvoy) are happening with airlines, and coincidentally airlines operate as regional monopolies in a lot of markets. What choice do you have but United if you live near Houston, Denver, etc.? Or Delta in Atlanta or Salt Lake or Minneapolis? Low cost carriers don't have much in the way of a loyalty program, so you don't really see United and Delta competing on the value proposition of their loyalty programs head to head, which is the distinguisher when you've already lowered ticket prices as much as you can. So the incentive to profit-maximizing airlines is to gut the programs as much as possible, try to bolster customer engagement with gamification (take four flights with us and earn pennies on the dollar in bonus miles you can't use!), and understand that a huge chunk of your customer base doesn't have much of a choice.
Changing to 1:1 transfer ratio to something worse will be an incentive to dump points cards and switch to 3-5% cash back cards altogether.
Airlines and their credit card enablers are playing a dangerous game that could sink them in the end.
I pity you Ed.
Seems you still don't get it.
People like you ARE the incentive to decrease cash back to less than 0.5%.
You are the one playing the game.
Airline and card enablers make the game for gullible hamsters like you.
While we're considering this enshittification, what doesn't disappoint: 2% of your spend, deposited into VOO or SPYM in your Fidelity brokerage account.
You're just moving chips from one casino game to another casino game.
Both are still rigged.
One "rigged game" at least has a positive return. Just saying.
The deception of believing in "positive return" IS the bait of the rigged game.
One could say Ponzi "at least has a positive return" until it doesn't.
Just saying.
There's like 70+ years of consistent data. Even with black swan events, the SnP "Ponzi market" still has 7% real returns over any 30 year period. The key is knowing your investment horizon and having the strength not to sell when everyone is running for the exits. It is definitely mass-psychology - there's little technical valuation for the basis of value. But what's really a better option that consistently beats inflation?
I mean, I don't...
There's like 70+ years of consistent data. Even with black swan events, the SnP "Ponzi market" still has 7% real returns over any 30 year period. The key is knowing your investment horizon and having the strength not to sell when everyone is running for the exits. It is definitely mass-psychology - there's little technical valuation for the basis of value. But what's really a better option that consistently beats inflation?
I mean, I don't want to dissuade you from whatever your investment strategy is. But I hope it's not loyalty programs. =o)
I suspect the negative inflection point will come when/if US Bank announces transfer partners for Altitude Reserve.
I like this wording:
“Why transferable points could become less valuable”
…. to me it seems, since 2021 ALL points/Miles from ANY transfer partners (in the US) as globally points are WAY less valuable since they were invented! … so lucky all those who get/have access to any of the versatile US Systems!
As i see it, it is pretty bad how much $$$$ is earned with such points but how little...
I like this wording:
“Why transferable points could become less valuable”
…. to me it seems, since 2021 ALL points/Miles from ANY transfer partners (in the US) as globally points are WAY less valuable since they were invented! … so lucky all those who get/have access to any of the versatile US Systems!
As i see it, it is pretty bad how much $$$$ is earned with such points but how little in return you can get and can get for it by now!
Awards are crazy high costs, transfer rations at a ridiculously low base by now and value for money, FORGET IT!
Rather pay cash/card for anything at any “Special” offer and NOT risking availability, good will of partners to have a transfer bonus, but even if they do …. you need to get lucky to find availability then! Enjoy points/miles since 1989, but i think, it’s never been as worse as now! US systems will be hit hard soon, coming close to duck bad exchanges and returns as International Programs are already!
This, 100%. All points are less valuable, everywhere. And the fiction that "inflation happened so it's still work [~1.7/point]" is total noise - you can find good deals on business R/T flights from many places, and it opens you up to try new things and get all the benefits without loyalty.
I now put 50% of my unbonused domestic spend on Fidelity because my brokerage doesn't disappoint.
I like what Aeroplan is doing. The internet (and especially leaches like roamme) forums are full of people who are transferring their points only to be thwarted by phantom availability.
And poof, their points are now stuck.
Not to mention, using the CSR 5K discount has all sorts of caveats… has to be on AC metal, can’t book with more than 1 person, etc.
I used the 5k aeroplan from csr on United metal on a last minute emergency flight home recently.
Well, if you allow corporate pseudo-currencies to proliferate without any baseline regulations or guardrails, yeah, inflation, devaluation, monopolization, rug-pulls, etc. are all bound to happen.
The 'gentleman's agreement' was that any changes to programs would at least be with 'notice.' However, there's no real rules... it can be abrupt; close over-night, etc.
Who's gonna rescue consumers? DOT? FTC? Not in this economy or with this administration, sadly. We're on our own. Don't hoard points....
Well, if you allow corporate pseudo-currencies to proliferate without any baseline regulations or guardrails, yeah, inflation, devaluation, monopolization, rug-pulls, etc. are all bound to happen.
The 'gentleman's agreement' was that any changes to programs would at least be with 'notice.' However, there's no real rules... it can be abrupt; close over-night, etc.
Who's gonna rescue consumers? DOT? FTC? Not in this economy or with this administration, sadly. We're on our own. Don't hoard points. Earn 'em and burn 'em.
The bigger question is: Who's truly 'holding the bag' here? Is it us consumers? The banks? Airlines? The taxpayers? Is this another bubble... *pop* (at least folks homes are not on the line this time.)
Also...yes, of course it will be the consumers 'holding the bag' - just like the poor and middle class get to pay for tax breaks for the rich. It's the American Way!
Yup - when capitalism does what capitalism does, folks who love capitalism all of a sudden complain about capitalism.
Let’s be clear, well-regulated capitalism is ‘okay,’ money making money, private ownership, all within-reason, is fine; it’s the late-stage crony capitalism that we’re in the thick of that’s a huge no-no.
The goal of capitalism is total control, aka crony capitalism.
The system is working as designed.
The regulated part is just a scam to convince people to get people in line.
Let's hope so. CC miles inflation is the main cause of low availability. We need to go back to FFPs primarily rewarding frequent flyers. Occasional top-up from a credit card is not a problem but people who never flew on an airline transfering 150k in and buying a business class ticket to Tokyo are something that shouldn't exist.
Below, Lepe writes, "You need to thank the bloggers for this demise." Which might seem harsh. To be fair, we need to throw in FlyerTalk, Reddit, etc. As word gets out about anything and people pile in, deals disappear. Banks and loyalty programs monitor these forums. When a sweet-spot redemption is discussed repeatedly, it's bound to be devalued. The only safe forum for hobbyists to share is a private forum.
Why would they ever need to monitor forums.
They already have the financials
In general it feels the miles & points world is slowly losing its remaining value, no?
Fewer opportunities for decent deals and tickets, more time spent searching availability and researching programs. It is the cash cow of airlines now, so there is not much of an edge left to be gained.
I'm more and more often looking at just paying cash fares instead of putting in countless hours to play the miles & points...
In general it feels the miles & points world is slowly losing its remaining value, no?
Fewer opportunities for decent deals and tickets, more time spent searching availability and researching programs. It is the cash cow of airlines now, so there is not much of an edge left to be gained.
I'm more and more often looking at just paying cash fares instead of putting in countless hours to play the miles & points game.
Also, as a society paying the 3% creditcard fee tax everywhere just to receive part of it back in points is also not very sustainable nor smart.
You have to pay the 3% anyway no matter what card you use. Granted you can minimize your losses with a cash back card but it's still a net loss.
I'd like to see some creativity on incentivizing card use since dangling award redemptions is increasingly misleading given the lack of availability at reasonable rates. Tack on the 3% as you mentioned and what are you really getting for your money?
I'll still play the...
You have to pay the 3% anyway no matter what card you use. Granted you can minimize your losses with a cash back card but it's still a net loss.
I'd like to see some creativity on incentivizing card use since dangling award redemptions is increasingly misleading given the lack of availability at reasonable rates. Tack on the 3% as you mentioned and what are you really getting for your money?
I'll still play the game for now but I'd like to see more anniversary bonuses to help offset or reimburse the extra 3% I'm paying throughout the year
agree 100%
If it's not explicitly separated on your bill nobody would care.
But don't you dare devalue my points.
People are that ignorant and entitled.
Paying a 3-5% markup on EVERYTHING to get 1.5-2% back is the biggest con the banks have pulled on Americans. And no, this is not an inevitable, unsolvable situation. In the EU, card transaction fees are capped at 0.5%.
If the airlines offered 5-10% discount for tickets paid for with debit cards, direct bank transfers or other direct payment methods, there are plenty of us who would abandon the credit card game and would use the airlines for just what they are: Transportation from point A to point B and back again. (Or some variation thereof.)
I was saying this for a long time about transferable points.
Yes it does provide flexibility.
No, it never protects even a little bit againts devaluation.
Selling those points kept some airlines afloat during the China virus outbreak. Now it backfires and people are like: nuh-uh!
@Endre keep your stupid comment to yourself!
But Endre needs somewhere to unload their racism!
"...we might be at a point where transferable points currencies are starting to change for the worse?"
That plane has already left the gate...
This is another warning sign that the glory days of points and miles is nearing an end.
You need to thank the bloggers for this demise
The glory days are long gone.
They were gone the day selling clicks began.
Its like fuel dumping. It was fun to fly around the world for pennies in business.
Or mistake fares, it was fun flying F for $75 to HKG while there was no risk of the fare blasted by scum like SF.
Or Lifemiles miscodes, fun until a blogger (Jeff Kwok) singlehandedly ruined that.
Given the US airline’s dependence on credit card revenue as flying people seems to be a loss leader these changes cumulatively may kill the credit card goose and its golden egg. Points are becoming useless to those without access to massive amounts of credit card joining bonuses only available to US customers. Almost a Ponzi scheme.
It's worse than a ponzi scheme.
Further enshitification of everything that is good.
It's actually worse than you think. You combine transferable banks, bilt, etc. with the fact that most airline programs have devalued premium awards, AND many more people chasing premium awards is making it very difficult to get values that we have seen in years past.
Hasn’t JetBlue been less than 1:1 for years now?
I do agree that this is likely to become more widespread though
They want you to use your points through their travel portals not with airline partners. Will continue to drive toward that goal.
good point, but as long as the ratio of using points on their own portals/travel partners, AmEx or Citi … i will rather lose value then using it on their own portals!
Total rip off!
The point has been reached already. 3:2, 4:3, 5:4 ratios have been around for a few years now. Try not limiting your analysis to the US market.
this has largely been my experience in Australia over the last five years. Used to be 1 AUD to 1 mile (for a range for airlines). Now lucky to get 1 AUD to 0.75 mile (if you do its limit to first few thousand dollars of spend). Mostly 1 AUD to 0.5 with caps on points earning of around 5-10000 per month.
In Australia is that not driven by legislation that caps the interchange fee at 0.88% (some merchants adding a surcharge for taking cards as well)? There is not enough left for generous cc rewards now. The same in the UK (0.30%): almost all cobranded cards were taken off the market.
Depending which payment (Visa, Master,AMEX)
same in Germany!
… US still a big advantage when it comes to earning points and transferring them too, BUT it will slowly become worse as it did in recent years!
ONLY bonuses make it worth to really transfer points in my opinion!
Same in Switzerland. Air France Klm with Mastercard gives you 1 mile per 2 Swiss Francs. Same with American Express
CC companies know this and they are coming for the US customers