5 things to think about with the 25%-30% Membership Rewards bonus

A lot of people with an American Express charge card got an email yesterday offering them a conversion bonus if they moved their Membership Rewards points into airline miles.

There seem to be two versions of the email.  The one I got offered a 25% bonus for conversions into British Airways, Virgin Atlantic, Etihad and Finnair.  Reports on Flyertalk mention a 30% version as well.

This is far cry from the 40% and even 100% bonuses seen in the past.  I am in two minds as to whether I should bite.

Amex MR banner

The first thing to remember is that the bonus miles generally post in arrears.   If you are thinking of doing a transfer and then using the Avios points next week, don’t.  Whilst your base Avios will go across quickly, the small print says that the 25% bonus for Avios will be credited by 15th April.  That is a whole two months after the promotion finishes on 15th February!

Secondly, do not rush to open an account with an airline you don’t normally collect with.   We have family in the Middle East and travel down there quite a bit, so an Etihad account MAY be of interest to me.  However, before I opened an account and made a transfer to them, I would want to know:

  • how many miles are needed (vs BA and Virgin) for business class to Abu Dhabi
  • how their fuel surcharges compare
  • how difficult it is to get 4 business class seats on the same flight
  • what their policy is on change fees, cancellation penalties etc

Thirdly, remember that you can get a 60% Avios bonus by opening an International Dollar Card (IDC) with Amex.

An IDC card is a normal Amex card but operating in US$.  They are available to UK residents, but Amex is quite strict on who gets one.  It takes a couple of months to be approved and if you haven’t been a long-term Amex customer (10 years plus) they usually want a written bank reference.

IDC has its own Membership Rewards programme – the catalogue is here.  The work of genius here is that you can ring Amex and transfer your points from the UK MR programme to the IDC programme.  Your balance is automatically increased by the £/$ exchange rate – so at $1.60 to the £, your 100,000 UK MR points will become 160,000.

Now, most redemption partners have worse exchange rates to compensate for this (BA and Virgin are 3:2 compared to 1:1 in the UK scheme, for example).  A few airlines are 1:1 in the IDC MR catalogue, such as FinnairEtihad is 3:2, however, so there is no arbitrage there.

Fourthly, remember that you can buy up to 10,000 Membership Rewards points per year for 1.5p each.

This might be worth it, depending on how you value an Avios.  With the 30% bonus, you’d be getting 13,000 Avios for £150, or 1.15p each.  I am not a buyer at that price, but you might be.  It depends on how you plan to redeem them.  Full details here.

Finally, remember that you can transfer Membership Rewards points to another person for a flat fee of £15.

Again, details here.  If your partner was targetted but you were not, you can transfer your points to him/her and get the bonus that way!

So ….

This might be a good deal for you.  And it might not.  Think it through first.  You have a few weeks to decide.

(To see our complete list of all current credit card bonuses, click here to visit our ‘Credit Cards Update’ page or use the link in the menu bar at the top of the page.)

Two gift card things ....
100 Clubcard points (240 Avios) when you spend £6 across 180 CD's
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Comments

  1. Is this purely targeted then as I don’t think I received an email re bonus?

  2. politicfool says:

    Can you also transfer to the Amex US MR programme if you happen to be a former US resident and still have US issued Amex cards?

    • If you have a US Membership Rewards account then, yes, I believe you can transfer over. Only once a year, though, so you could do it now and then you’d need to save your UK points for the next 12 months before you could do it again.

  3. whitenoise says:

    That’s interesting, only got the 20% version here…

  4. arse… nothing received :(

  5. Ian Knox says:

    does having an IDC card prevent you churning uk based cards?

  6. I got the 25% offer which includes BA and VS.

    According to the T+Cs, the BA bonus Avios will be awarded by 15 April 2013 and the VS bonus miles by 11 March 2013.

    Hmm. I know that bonuses sometimes appear earlier, but the fallback date is important to me because I’m almost sure to give up my platinum card by March 2013.

    I can’t risk ‘losing’ the BA bonus so it looks like VFC will get the credit. (‘Losing’ in quotes because you can’t lose what you didn’t have. ;))

    • I may have jumped to the wrong conclusion here.

      It must be the transfer date that has to be within card validity, not the bonus credit date, so I could cheerfully transfer my MR points to BA by 15.2, cancel the card on 28.2 and see the bonus Avios by 15.4.

      I hope.

  7. So 2 questions:
    1. If you have an IDC card, does that prevent you from accessing bonuses since its a UK issued Amex with a MR account?
    2. Can you transfer points back into a MR account at the same exchange rate?

    • 1. Don’t know. The UK MR scheme is totally separate to the IDC one (and indeed the UK Small Business MR scheme is separate to the UK personal cards MR scheme). In reality, you would probably be OK but I can’t be certain.

      2. Yes, I believe it works both ways. However, you can only do one transfer a year out of an account. You can’t ring up each month and move your UK points to IDC, you need to accumulate them and do it once a year.

  8. It sucks to not get the promotion..paying all this $$ to Amex for plat to find everyone else gets better promotions!

  9. I only just received the email, way after everyone else – so there may still be hope for you if you don’t have it yet. Think I will hedge my bets and transfer some to VS but keep the remainder in MR for now.

    • I have 21000 amex points was going to transfer them to BAEC but I will wait to see if I get an email from Amex. Thanks Raffles again.

  10. vi irwin says:

    Sorry if this is a little off-topic, but exactly how good are virgin miles? How many is it to cross the Atlantic and what are taxes and surcharges like?. Can they be used on any other routes?

    I’ve tried looking online and can’t see these simple facts anywhere.

    • In order:
      – how long is a piece of string? Virgin Flying Club members think they’re great.
      – yes; bad, similar to BA.
      – yes.

      Have you tried looking at the VS website? The homepage http://www.virgin-atlantic.com has a link to Virgin Flying Club.

      • vi irwin says:

        Yes I signed up and tried to see what use they were. All I seem to have learned is that one can’t use them to go to China, or one can spend a lot of points to get a flight that costs the same as not spending points to New York

        • A couple of points. Your first message mentioned crossing the Atlantic. VS fly to lots of places in the US and Caribbean.

          VS fly to Shanghai in China.

          It’s generally poor use of miles to redeem them for economy flights. They come into their own when used for business or first class.

          • Jasper Rasper says:

            I sometimes feel that Business class is the biggest con of our era.

            Virgin Miles is a scam

  11. onlysuites says:

    I didn’t get the email, actually I never really get emails from Amex. I won’t qualify for this bonus will I?

    Is there a box I need to tick to get emails?

  12. onlysuites says:

    Edit – Ticked the right box. It seems I had chosen not to get marketing emails.

    • You need to tick a box for EACH Amex card you hold. This is a common mistake. People opt in to marketing for the BA card and then think, for example, they will also receive offers relating to their other cards. You won’t. There is a separate opt in form for each card.

  13. The IDC strategy seems amazing when combined with the current Platinum signup bonus. I can see the following plan working really nicely:
    1. get a Platinum card for yourself, collect 52k points (assuming someone refers you)
    2. refer your spouse for another Platinum card (you collect 25k points, they collect 52k)
    3. spouse transfers their points to you for £15 – total 129k points
    4. take out the IDC (Green version is $100/year, MR is free for the first year but then $36 a year afterwards, so you might want to time this properly)
    5. transfer the UK MR points to IDC – total 206,400 points
    6. transfer from IDC to Iberia Plus Avios – total 206,400 points

    The extra Avios resulting from this strategy would be 77,400, at a cost of approximately £75 – which works out to a truly amazing 0.09p per Avios.