MORE AMEX CUTS: Some sign-up bonuses and referral bonuses reduced, with immediate effect

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Last month American Express made some aggressive – and frankly confusing – changes to the rules regarding who qualifies for a sign-up bonus on its personal UK cards.  My summary of the Amex sign-up rule changes is here.

There are now further changes.  This time American Express has changed the sign-up bonuses and referral bonuses on some cards.

Which cards have changed?

The changes impact American Express Preferred Rewards Gold, The Platinum Card and the American Express Rewards Credit Card.

The changes were due to go live at midnight last night and are already in effect.

Change to American Express Gold sign up bonus

What are the changes to sign-up bonuses?

On Preferred Rewards Gold:

The sign-up bonus has been halved from 20,000 Membership Rewards points to 10,000 Membership Rewards points

The qualifying spend required to earn the bonus has increased from £2,000 within three months to £3,000 within three months

If you are referred by a friend to the card, you will receive a higher sign-up bonus of 12,000 Membership Rewards points (previously 22,000 Membership Rewards points)

On the American Express Rewards Credit Card:

The sign-up bonus has been halved from 10,000 Membership Rewards points to 5,000 Membership Rewards points

The qualifying spend required to earn the bonus has increased from £1,000 within three months to £2,000 within three months

On the American Express Rewards Low Rate Credit Card:

The sign-up bonus has been halved from 5,000 Membership Rewards points to 2,500 Membership Rewards points

The qualifying spend required to earn the bonus has increased from £500 within three months to £1,000 within three months

There is no change to the sign-up bonus or spending target on The Platinum Card.

What are the changes to referral bonuses?

With Preferred Rewards Gold:

The bonus you receive for referring a friend falls from 9,000 Membership Rewards points to 6,000 Membership Rewards points

The annual cap on referral points remains at 90,000 points

With The Platinum Card:

The bonus you receive for referring a friend falls from 18,000 Membership Rewards points to 12,000 Membership Rewards points

The annual cap on referral points remains at 90,000 points (if you refer 8 people, you only receive 6,000 points for the last one as you hit the 90,000 points cap)

There are no referral bonuses for the American Express Rewards Credit Card.

There are no changes at all, for now, to the British Airways, Nectar and Starwood card bonuses.

American Express Rewards Credit Card

What is going on here?

On the face of it, some of these changes do not make a lot of sense.  Primarily, why should you need to spend £3,000 to get the bonus on Preferred Rewards Gold when you only need to spend £2,000 to get the bonus on The Platinum Card?

I get a feeling that American Express is pulling back from its attempts to make Preferred Rewards Gold a mass-market product.  There is no other logical reason for pushing up the target spend to £3,000 in three months, which for Mr & Mrs Average is likely to be more than their remaining cash once housing costs and household bills are paid.

It is possible that the American Express Rewards Credit Card will be positioned as the mass-market product, although doubling the target spend to receive the sign-up bonus will also reduce the market for this product.

I am not really concerned about the changes to the American Express Rewards Credit Card, because the only reason a HFP reader should get this is to ‘protect’ your Membership Rewards points from deletion if you choose to cancel your Gold or Platinum cardI explain more in this article.

Is Amex risking long term damage by cutting off the ‘path’ for new cardholders?

My first American Express card, a long time ago, was a Gold.  Over time I progressed to The Platinum Card, and then – when it launched in 2004ish – the British Airways Premium Plus card, which was initially free to holders of The Platinum Card.

I suspect that – outside the world of Head for Points readers, who are well educated by our articles on the benefits of each card – most people start off with the free cards and then progress.  This is either as their income increases (so they can afford the annual fees on the premium cards) or as they become more comfortable with American Express as a partner.

Amex has now made ‘progressing’ less attractive.  For example:

if you start with the ‘free for life’ American Express Rewards Credit Card or ‘free for the first year’ Amex Gold, you are disqualified from the bonus on the free British Airways card or the Starwood card

if you start with the free BA Amex but decide that narrowing your focus to just Avios rewards makes no sense, you are locked out of the bonus on Gold, Starwood etc

if you start with the Starwood card but decide that Marriott Bonvoy no longer offers good value redemptions, you are locked out of the bonus on Gold and the free BA card

There are also no upgrade bonuses to persuade people to go from the free BA card to Premium Plus, or from the new credit card version of Preferred Rewards Gold to The Platinum Card.

American Express changing sign-up bonuses

And what is ‘the best starter card’ now?

HFP has generally promoted Preferred Rewards Gold as the best ‘starter’ card for someone coming into travel rewards.  This is because:

it had a generous sign-up bonus of 20,000 points (=20,000 Avios)

the points could be converted to a LOT of different rewards programmes, so you didn’t have to focus too early whilst you learned the ropes

you got your first year for free

you got two free airport lounge passes

you were free to earn a bonus on the BA or Starwood cards at a later date if you did choose to specialise

The situation is now different:

the sign-up bonus has been halved to 10,000 points (=10,000 Avios)

the target spend has been increased to £3,000 in three months

taking out Preferred Rewards Gold now blocks you from getting a sign-up bonus on a later date for the free British Airways card or the Starwood card – your only option for another bonus is the British Airways Premium Plus card

Overall, I am still tempted to say that Amex Gold is the best starter card for most people.  There is still a bonus, albeit lower, and the two free airport lounge passes will open your eyes to what your miles and points can do for you.  There is still no fee for the first year.

It is arguably better than telling people to start with the free BA Amex, which blocks them from both the Amex Gold bonus and the BA Premium Plus bonus.  In reality, the best ‘first’ card is probably:

The Platinum Card – but most people who are new to Amex won’t want to stump up £450, or

The Starwood Preferred Guest American Express card – because you can still get a bonus on both The Platinum Card and British Airways Premium Plus later, and you only need to spend £1,000 to trigger the sign-up bonus.  However, this is a confusing card for a beginner (even explaining why the Marriott card is called the Starwood card isn’t simple), it has a fee and the two cards you can upgrade to both have even chunkier fees which a lot of the market doesn’t want to pay.

The ‘keep it simple, stupid’ school of marketing is one which I have always believed in, but the current run of changes at American Express seems to be putting that to the test.

Important interest rate information

For the cards mentioned in this article, I am legally obliged to remind you that:

American Express Preferred Rewards Goldrepresentative APR 57.6% variable including the annual fee (free in year 1) based on a notional £1,200 credit limit.  Apply hereReview here.

The Platinum Card from American Expressno interest rate information as it is a charge card.  Apply hereReview here.

American Express Rewardsrepresentative APR 22.9% variable.  Apply hereReview here.

American Express Rewards Low Raterepresentative APR 9.9% variable.  Apply hereReview here.

The Starwood Preferred Guest American Express card –  representative APR 39.7% variable including the annual fee based on a notional £1200 credit limitApply hereReview here.

British Airways American Expressrepresentative APR 22.9% variableApply hereReview here.

British Airways American Express Premium Plus – representative APR 76.0% variable including £195 fee based on a notional £1200 credit limit. Apply hereReview here.

(Want to earn more miles and points from credit cards?  Click here to visit our dedicated airline and hotel travel credit cards page or use the ‘Credit Cards Update’ link in the menu bar at the top of the page.)

Disclaimer: Head for Points is a journalistic website. Nothing here should be construed as financial advice, and it is your own responsibility to ensure that any product is right for your circumstances. Recommendations are based primarily on the ability to earn miles and points and do not consider interest rates, service levels or any impact on your credit history.  By recommending credit cards on this site, I am – technically – acting as a credit broker.  Robert Burgess, trading as Head for Points, is regulated and authorised by the Financial Conduct Authority to act as a credit broker.

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Comments

  1. I had just had an email from AMEX to refer my friends for 6,000 MR points. Thanks for reminding me of your devaluation! It’s like rubbing salt into a wound.

  2. Dave Barron says:

    Hi,

    Apologies if this has already been covered but I have a query about referral bonuses.

    Prior to the recent reduction of referral points I emailed myself a referral link from my Platinum Card. Using this link I have now just self referred for the Nectar Card. I appreciate that I won’t get any welcome bonus (should have done so sooner!!) but presume I will get the 1000 nectar point referral bonus? Also given that I used a link which was valid prior to the latest referral devaluation do you think I continue to have a good chance of getting the 18k referral bonus rather than the new lower referral bonus of just 12k?

    Although not guaranteed I assume the loophole of self referral remains open?

    My application has been accepted so guess will just have to see but I would welcome the experiences of others.

    Thanks in advance!

    • Peter K says:

      I sent a referral code to someone before the devaluation. It is exactly the same link as is generated now if I want to refer someone. I assume therefore that the old link will thus only give the new referral bonus now, not the old.

  3. why does everyone discuss in open forums all of the things than amex will look to block next?

  4. Aren’t Amex going to be losing lots of money by doing the recent cuts. I for a me will only ever get an AE Card once every two years now

    • Supermix says:

      According to some people on here no. Apparently, according to them, money spent on Amex cards doesn’t make American Express money – I know! lol

      The UK and Europe accounts for a very small amount of their income. So much so they have all but given up on their top tiers cards in the UK – can’t even manage a roll out of metal Platinum cards. Nevermind some real perks or offering a decent travel insurance policy.

      • guesswho2000 says:

        I don’t know whether this is a serious comment or not?!
        Metal card, fair enough it’s a nice gimmick, and they’ve rolled them out elsewhere, but seriously?
        The travel insurance is still pretty good, even with a few extra hurdles, especially bearing in mind that the main elements don’t have the limitations of having to pay with the card, and their claims process is pretty quick and efficient.
        Each to their own I guess!

        • Ricatti says:

          Supermix spoken from the viewpoint of Global AMEX, and it is true. Brighton processes and systems were “dated”, a lot of bonus awarding was manually or batch- implemented by back office in India. I remember that nice messaging facility where you could communicate to those back office people, and they invariably obliged.

          Then global AMEX restructured their offshore operations, and UK AMEX was pretty much cut off from control of back office — they take what is processed for them. Brighton are takers — of processes, controls, and if global decides servicing their cards (UK AMEX card) out of Philippines including account opening.

          The new AMEX UK website is what US had for years.

        • The AMEX insurance is rubbish IF you have any pre-existing medical conditions. The fact that you can’t even pay a supplement to cover those conditions makes it absolutely useless for quite a few (including me).

    • If you assume they paid out 1p for every bonus Avios or MR point you ever earned, you will work out very quickly they will be hugely better off.

      They were literally paying out £2,000 per year for every couple which was churning a Gold and a BAPP every 6 month, each, and cross referring.

  5. Roy Badami says:

    Interestingly, these latest changes mean that the difference between the Gold and Platinum sign-up bonuses is now exactly the same as the the upgrade bonus from the legacy Gold card to Platinum: 20,000 points.

    I wonder if this is a prelude to a platinum ‘upgrade’ offer targeting holders of the new-style Gold card?

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