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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.

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. Volker says:

    I have got a funny feeling that the next thing on AMEX’ cost cutting agenda will be significant changes to the transfer rates of MR points into Airline miles etc.

    • Trevor says:

      Agreed. I may just transfer some over today….

    • Doug M says:

      That would seriously test their worth to long term spenders. Interesting to hear Rob’s thoughts on this. He said yesterday he’d never seen a devaluation.

      • Trevor says:

        Also I note:
        “Our Shop with Points at Amazon.co.uk redemption option is currently unavailable until further notice. Our Customer Service team are also only able to provide a limited service. We apologise for any inconvenience this may cause.”

      • guesswho2000 says:

        It’s happened in Australia, as of yesterday, 1:1 is now 2:1 MR to Airline miles

  2. On the website, the changes for Amex gold sign up bonus and £3k over 3 months have changed but not the referral bonus.

    • Has on my account. Now says something like “Refer someone to a gold card and receive 6000 MR points”

    • Michael says:

      They had notice though. They also doubled most of the accounts so you had the value you had originally.

  3. Also looks like the 10,000 annual points bonus for a £15k spend has gone

    Any news on this element Rob

  4. I can’t see the point in even retaining any Amex now once my next 2-4-1 is triggered. Collecting enough Avios for redemptions had already got pretty much beyond reach with the last changes. Now it seems it definitely is.

    I get that Amex probably don’t make a lot of money from me, but they charge merchants more than Visa/MC do in order to pay for it. If there’s no advantage there’s no reason to charge more – is this their strategy? To be able to reduce costs in order to cut merchants fees and thus encourage more merchants to take it? The downside would be there is now little reason for people to get Amex over the other CCs, unless you go Platinum.

    As for me, I might start looking into other rewards cards – I’ve always largely ignored them before.

    • ‘I can’t see the point in even retaining any Amex now once my next 2-4-1 is triggered. ‘
      Unless they start enforcing the ‘pay with the earning card’ condition.

      • I think this is inevitable unless they go the opposite way and relax it and make any amex official policy. Paying with it would be one thing but holding onto a £195 card you no longer wanted to cover any future changes to the reservation would be too much to stomach.

      • I’d hope that downgrading it to the free one would count still… I’m due to trigger it in the next 3 or 4 weeks (been hovering the spend just short as I have no immediate use for it), and will probably not actually make a booking for another year. Wasn’t planning on paying out £195 – potentially twice – in order to make the booking!

  5. Cross card referrals definitely gone, had old links saved and they now allow only same card referral regardless of browser being used.

    • TGLoyalty says:

      looks like my Plat link can refer Gold and green

      But maybe it bugs

      • They are same family so it might be back to that or msy just be the latest disappearing act as Peter says.

    • I see very similar, I only have a BA Premium at the moment and can refer for that or the BA standard card. I think the function to refer for other cards has come and gone in the past, usually mixed in with juggling web browsers to make it work. I think this time might be it as it has come with all these other changes.

    • Still seems to work – the wording clearly leads you towards the referred card but the option to choose another card is still live, quote:

      Not the right Card for you? You can apply for the Card you have been referred for or simply browse any of the below Cards to choose another rewarding Card that may suit you better – whilst still benefiting from a referral bonus

    • Although they’ve come and gone before, so don’t think we can say for certain until a week or so has passed?

  6. Freddy says:

    Business amex gold still showing as 20000…for now anyway

  7. Alex B says:

    Hmm. I don’t know about bad news coming in threes but I suddenly feel a very strong urge to transfer out a large number of MR points.

    • Whizz68 says:

      I guess you should, you don’t want to regret it later !

      • Yorkieflyer says:

        With most providers I think transfer rate changes have been given some notice, however this is Amex?!

    • That would not be wise, in general.

      • Alex B says:

        Hi Rob,

        I totally accept that the value of MR points is in their flexibility. However isn’t it reasonable to assume that they might now devalue the transfer ratios? If they did would it be overnight effective immediately or would we have notice to transfer at the current rate?

        Thanks

        • No, because messing with MR means messing with the reward proposition on every card which issues MR points, which is a lot of them. Far easier just to change the earning rate on any particular card.

    • guesswho2000 says:

      It might happen, it has in Australia (effective Monday just gone), but you’ll get a fair amount of notice (we got about six months). I wouldn’t transfer speculatively now.

  8. Matthew says:

    I can live with most of these changes but it would have been nice to get a little warning.

    Also, why not get rid of the 90,000 annual referral cap? And increase the points per £ on the Plat. Both of which encourage long term spending and keeping the card. It all seems a little one-way at the moment…

    • Shoestring says:

      there’s a reason the Chancellor announces duty increases on booze, coming into effect at midnight tonight 🙂

      the whole purpose of changes like this is to…effect change to a business model because you think it’s a smart move – why give people more wiggle room than necessary?

      I don’t think Raffles got the news at midnight lol – what about your homies, eh Raffles? – I might have squeezed one in under the radar 🙂

    • To be honest I thought the cap would drop to 60k and specifically went back to Amex for clarification it would remain at 90k.

  9. Qwerty Bertie says:

    It’s annoying that the 18k has reduced to 12k, but until any further negative changes are made to the platinum I will hold it.

    I already have travel insurance through HSBC current account, though I have no idea how it compares, and became diamond with Hilton through a match and likely to retain it in the second year based on current patronage. Don’t use other hotel chains. Rarely hire cars. Only use lounges two or three times per year, albeit three/four people at once.

    The referrals and cashback are looking like the main factors for me retaining it, and if these get whittled down any further it could be the breaking point for me. If I do ditch it, I would end up applying again at some point if I can’t keep at least gold with Hilton through stays/nights.

    If they would just increase the earning rate for spend, say 2 MR per £ flat rate – but not water it down any further in other respects – I would stick to it for life and use it exclusively except for a back-up mastercard… This really annoys me, as they will give out a real 1.25% cashback on their £25 fee card, but only 1 MR on a £450 fee card which costs them what…0.5p average?

    • Shoestring says:

      wasn’t so long ago that you got 2 MR points per £1 on all spend in the first year (Gold)…

      definitely do-able

    • Ricatti says:

      Not going to happen.

      Precisely because high spenders are on Platinum and 2 MR points will lead to disproportional payouts. Too expensive for AMEX en masse.

  10. Graham Walsh says:

    12k is still a good amount of points for referrals. As most things, all good things come to end. Just debating whether to close off partners Amex and transfer miles to BA or downgrade to Amex rewards to keep the MR Currency? Just wondering what is the next trick/devaluation might be? MR is 0.5 Avios?

    • Shoestring says:

      wouldn’t Amex have to give 30 days’ notice of that sort of change?

      my contract doesn’t state they can change MR points —> airline partners calculation at will

      • Graham Walsh says:

        No idea, at least you get 30 days to use/move your points if you do close your card. With their current mood and changes, guessing anything is possible.

      • callum says:

        Your contract doesn’t specify a MR points -> airline partner calculation at all.

  11. Nigel the pensioner says:

    Its all been pretty much said but to summarise as I see it….
    The referral bonuses are legitimate incentives given as a one off thank you from AmEx for increasing their cardholder base.
    The subsequent churning of cards is not in the spirit of the rules. The promoting of such loopholes has seemingly promoted an exaggerated backlash from AmEx of global reductions in incentives. However, I think that this will be only whilst they take stock of UK competition and how to disincentivise churning.
    I would not be surprised to see it settle as the return of the original first time bonuses and ongoing referral bonuses but nothing ever again. Why should you get a second bonus every 6 months or 2 years or even 5 years….? The encouragement of people to do this on a mass scale with an on line readership of (apparently) thousands of HfP readers and other sites of course, has resulted in the end of this unintentional benefit, and for now, worse.
    The issue with Curve too may well have something to do with inadvertently “promoting” irresponsible spending although there are so many intermediate steps and agencies in this process, it is hard to determine.
    Will I keep my AmEx? Yes, despite the annual fee as the other benefits are worthwhile. We also seem to manage high status with BA as do others with bookings which in turn generate more difficult to use Avios.
    The AmEx points have traditionally been swapped to the VS account every few years to fund UC seats for us to the US.
    Another long-winded contribution but lets see how it all pans out. Churning is over thank goodness!

  12. Yorkieflyer says:

    Mrs Yorkieflyer may be mulling over how much longer to keep the Plat card. Just, thankfully earned two referrals but looking to the year ahead. Travel insurance no value due to pre existing conditions, now have annual world wide Nationwide flex cover. Hotel status minimal apart from Hilton Gold. Car hire insurance, some value. Priority pass is last remaining significant benefit.

  13. melissa says:

    Fearing for the day Amex will change the transfer rate to airlines without prior notice. Is it a sensible idea to transfer my current MR points to Marriot Bonvoy? I don’t have any particular use for them at the moment and I don’t want them to devalue. I have enough avios for upcoming flights.

    • This is very unlikely to happen, because it impacts every MR card at once including corporate ones. FAR more likely that individual cards would change,

  14. TGLoyalty says:

    So we’ve had all the changes that discourage churning and signing up for cards

    Where are the ones that persuade you to stay?

    • Shoestring says:

      can’t see many cashback cards with still quite generous referral bonuses out there…

  15. Was (coincidentally) halfway towards Gold £15 spend target so that was going to be our strategy but now wonder if we should stick with BAPP. I guess there is just as much likelihood of the £15 bonus being removed as there is of BAPP reducing from 1.5 avios per £

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