American Express USA bans card churning …. UK to follow?

This article is closed to new comments. Feel free to ask your question in the HfP forums.

• Gordon says:

  27 Mar27 March 07:06

  Im not so sure its a tiny minority and clearly as time passes the percentage can only go up

• Singing Dwarf says:

  27 Mar27 March 07:19

  I tweeted Annex UK about this yesterday, after seeing an article on another blog.

  They responded as follows:

  ” @AskAmexUK @thesingingdwarf Hi there. There are no current plans to make similar changes in the UK. It’s currently 6 months without the card. Thanks ^P”

  Link to Tweet: https://twitter.com/AskAmexUK/status/448861161979510784

  Read into this what you will…

  • Flieduk says:

    27 Mar27 March 08:00

    But thanks for pointing their noses to the fact that they have churners over here 😛

    • Trevor says:

      27 Mar27 March 08:41

      What, they didn’t know?! 😮

      • Flieduk says:

        27 Mar27 March 08:46

        It’s not so much whether “they” know or dont know. Amex is a massive operation whose stuff deal with multiple matters. You just dont want to keep poking the fire

        • Singing Dwarf says:

          27 Mar27 March 23:30

          Amex are not stupid – they know exactly how many churners they have and how much these churners cost them, compared to the ‘average’ customer.

          Amex can already refuse your business completely if they want to and they don’t need to give you a reason. If they don’t want you as a customer, they don’t have to accept your application – regardless of how many cards you have had in the past and how quickly you have got rid of them!

          What this move by American Express in the USA may do, is to actually increase the churn rate here in the UK. Points hunters here, who are concerned that the gravy train may be about to hit the bumpers could start jumping on, or start churning more aggressively. This in turn could actually hasten a degradation in the value of the offer made here by Amex UK.

    • Rob says:

      27 Mar27 March 09:29

      I had a long session with Amex at their head office last year …. they are not dim.

      • Flieduk says:

        27 Mar27 March 12:52

        RAFFLES!! You cannot say that you had a “long session” at AMEX UK HQ and not tell us anything juicy

• ian says:

  27 Mar27 March 07:21

  I was reading about this yesterday. The biggest moaners were the constant churners, who showed that they had no understanding of the fact that it’s directly down to them that AMEX have taken this step.

  It’s the same with all promotions. The people who abuse them eventually spoil it for everyone else.

  • nick says:

    27 Mar27 March 09:01

    Amen. A greedy few take the piss and ruin good offers for everyone else. The guy who bought a box full of the Dan Brown books on the Tesco promo. The people doing £20k of 3v. The people who systematically cancel and re apply for cards. They kill the golden goose.

    • Malibu Stacey says:

      27 Mar27 March 09:07

      The people who run blogs and make a living from credit card referrals?

      • nick says:

        27 Mar27 March 09:16

        Raffles urges caution with most offers and he doesn’t churn cards.

        • Iheartarbitrage says:

          30 Mar30 March 12:35

          I’m guessing Raffles gets a few referrals, so probably doesn’t need to churn cards

        • Rob says:

          30 Mar30 March 14:10

          I’ve had my Plat since 1999 and my BA Amex since 2002, as I put in the original article – 13 years and 10 years respectively before I started this site!

      • Rob says:

        27 Mar27 March 09:25

        A committed churner would refer his or her partner, and vice versa, each time. Nothing in it for me after the first application!

        What would change is that I would have to be careful about, say, recommended the SPG card when it was not offering 20k, because applying when it is 10k would ruin your chance of getting the better deal later.

      • ClemK says:

        27 Mar27 March 14:19

        Haha my thinking too 🙂

    • Rob says:

      27 Mar27 March 09:24

      Disagree with 1 as that would have been publisher funded, desperate to shift units. Disagree with 2, 3V’s continue to be available and they simply closed a mistake (probably genuine) which let them be used for financial services transactions.

      More sympathetic with 3! However, IF churning was restricted then bonuses may increase, which would improve the situation for non churners.

      • Nick says:

        27 Mar27 March 10:25

        I’m not referring to the closure of the 3V loophole – as you say, that was always going to happen. The point is more that churning cards and really going over the top on supermarket deals is not going to work for Tescos and the card companies in the long run. They are our allies in this game, not the enemy.

    • Mrtibbs1999 says:

      27 Mar27 March 10:33

      I bought boxes of the books. Why? Because I knew that an offer like that was a win win. The publishers wanted to sell as many books as possible and they allowed Tesco to bribe us into buying them. You need to see the bigger picture.

      • Flieduk says:

        27 Mar27 March 15:00

        How did the profit work out after resale?

        • Mrtibbs1999 says:

          27 Mar27 March 17:42

          I sold most of them
          to a bookstore at cost less 10%. The ones I sold on eBay lost 50%

    • What's the Point says:

      28 Mar28 March 02:31

      Slightly 3V related – I saw a $500 Visa gift card on sale in a shopping mall I was at today in America. I read the small print, but unfortunately only usable in the USA.
      Manufactured spend could be done in afternoon, with that kind of limit!

      • Rob says:

        28 Mar28 March 07:17

        There is a US payments scheme which allows $5,000 of cards a month to be processed into a bank with it. All the US guys therefore buy $5,000 of gift cards each month and immediately cash out. Even better, some credit cards offer a 500% points bonus on office supplies purchases, so you buy these cards in Office Depot or Staples and you bank 25,000 miles. Per month. For ‘almost’ free.

        • What's the Point says:

          28 Mar28 March 15:01

          All very well, but you will end up gaining a few hundred kilos in weight living out here just to feed the Avios habit!

• Frenske says:

  27 Mar27 March 07:35

  By having a six month period, AmEx sort of encourages churning. If it would be one year, it becomes less attractive.

  • Paul says:

    27 Mar27 March 07:40

    Yeah, that was my reaction to this change. For AMEX to take steps to combat constant churning is understandable, but why not do so by increasing the current 6-months to say, 5 years, without having held the card.

    Ultimately these signup bonuses exist to incentivise customers to signup. Surely there comes a point at which it’s advantageous for AMEX to try and incentivise a previous customer to return…

    • Rob says:

      27 Mar27 March 07:52

      In reality, I reckon after a couple of years you would be ok.

    • Trevor says:

      27 Mar27 March 08:45

      In the US it was already 12months, and now moving to “forever”. So for a change, the UK is one-up, our churning period has been shorter, and will be infinitely shorter 😉 But given that the US signups, even for the BAPP, is mor ein the region of 70,000 bonus Avios, I’d be willing to forfeit 6 months for an extra 50k points!

      • squills says:

        27 Mar27 March 09:01

        I imagine Amex views USA very differently to UK. Amex is still much less developed as a card over here in comparison to Visa/ M/C – ie they’d still see the marketing job as grabbing market share to push it up to a decent wedge, even if that cost a lot in these relatively early days. So being more lenient on churning could easily fall into that strategy, ie no need to go in hard on the churners just yet as the churners are (on the face of it) still worth having.

        Obviously a lot of us would like to think it works for us, ie the benefits we get out, far outweigh the costs. But Amex probably don’t analyse it the same way. They’d see it as acquisition of new customers – who then rapidly push through a few thou of expenditure.

• M says:

  27 Mar27 March 07:42

  Maybe in the US it was happening on a bigger scale? If they’d apply the same rule in the UK it would a disaster imho.

  • Rob says:

    27 Mar27 March 07:53

    Clearly not a disaster for the reasons outlined in the post!

• Alan says:

  27 Mar27 March 07:44

  If they were going to do this in the UK I’d want them to also mirror two other things they have in the US – much much bigger sign up bonuses and zero fee forex!

  • Rob says:

    27 Mar27 March 07:54

    Bonuses may increase if churning is blocked, that is true. Amex has been trialling higher bonuses via mail shots in recent months in the UK.

  • Phillip says:

    27 Mar27 March 08:01

    I second the mirroring of bigger bonuses as well as things like, card renewal bonuses. For example the Amex Gold Card gets 15k MR for $30k spend in the US, when in the UK it’s only 7.5k MR for £15k spend. Or how about the 3x MR per $1 spent on the Gold card in the US vs 2x MR for £1 in the UK? $125 VS £125 Annual Fee? And the list of additional benefits you get in the US goes on…

    • nick says:

      27 Mar27 March 09:08

      Interchange fees are higher in the us, I believe, so that funds the bigger bonuses. And they are not under threat from the eu cross border interchange fee cap that will soon filter through to domestic transactions and amex, even if they are currently outside the scope.

• Mr Bridge says:

  27 Mar27 March 07:47

  One should bear in mind that in the uk we pay £450 for plat amex, and in the us they pay $450.
  There are other difference too, like usa do not pay the 3% FX charge.( that cost me a couple of £hundred a year!
  yet the conversion of MR is the same to avios.
  So you we get a raw deal anyway, churning in uk helps to mitigate that.
  Quite simply no churning= no renewal for me.

• Stu says:

  27 Mar27 March 07:53

  I wonder how the May 2nd date will be implemented. Will they base the rule solely on card signups *from* May 2nd onwards, or will they look back at all your cards prior to this date to decide whether you get any bonus. I guess it’s the latter.

  • Rob says:

    27 Mar27 March 09:30

    People were assuming the first but the statement implies the second, which makes more sense.

This article is closed to new comments. Feel free to ask your question in the HfP forums.