This is what happens on 29th February with American Express pro-rata fee refunds

American Express has traditionally offered one feature which other UK credit card companies did not.

If you took out a card with an upfront annual fee, you would receive a pro-rata fee refund if you cancelled your card part-way through the year.

Amex decided to stop pro-rata fee refunds on 2nd October 2023. At the last minute it had a change of heart, and announced that refunds would still be available until at least 29th February 2024.

So …. what happens next?

I have been speaking to American Express this week and it has issued this statement:

Pro-rata refunds on credit cards will be removed later in the year. We will provide a firm date in due course.

This may seem a bit too short and sweet, but it actually tells you everything you need to know:

Message 1 – nothing changes on 29th February

You don’t need to worry about cancelling any American Express cards by 29th February. Whilst 1st March was the earliest date that Amex said it MAY remove pro-rata refunds, this is not going to happen.

You are OK until ‘later in the year’.

Message 2 – notice will be given that pro-rata refunds are ending

When Amex does finally decide on a date, notice will be given. You will have time to cancel any cards which you do not wish to retain for the rest of their card year.

Now …. it’s not clear HOW this notice will be given. It is possible that it is only given via HfP and via a message somewhere on the Amex website.

Amex may not need to formally notify cardholders, because I don’t think cardholders were ever told that the original end date of 2nd October 2023 had been scrapped.

Will fee refunds will be scrapped on all American Express cards?

No.

The change only impacts personal and business credit cards.

If you still hold a charge card – although all personal charge cards have been withdrawn from the market over the last couple of years for new applicants – then nothing changes. You will still be able to cancel it at any point for a pro-rata fee refund.

What happens if American Express cancels your card?

You will still receive a pro-rata fee refund if your card is cancelled by American Express for any reason.

How will the end of pro-rata refunds change the card market?

That’s a good question, especially as you also need to factor in the appeal of competing products – the Barclaycard Avios Plus Mastercard, for example, has a fee of £20 per month and so can be cancelled at any time without penalty.

Let’s look at a few of the cards:

American Express Preferred Rewards Gold

American Express Preferred Rewards Gold is free for the first year, so the appeal of this card (you currently receive 20,000 Membership Rewards points bonus, £120 of Deliveroo credit and four airport lounge passes) is unchanged.

The Platinum Card from American Express

The Platinum Card is more complex, but even at a non-refundable £650 for the first year it would remain a good proposition (40,000 Membership Rewards points bonus, £300 of dining credit in your first calendar year, £300 of dining credit in your second calendar year, up to £150 of Harvey Nichols credit across your first 12 months, two Priority Passes, travel insurance etc. This assumes the dining and Harvey Nichols benefits continue beyond 2024.)

During special offers such as the recent 75,000 bonus points promotion it becomes exceptional value for the first year, even at the full £650.

British Airways Premium Plus American Express

The British Airways Premium Plus card becomes less attractive for a quick pump and dump, with the 25,000 Avios bonus equalling but not exceeding the non-refundable £250 annual fee on our valuation.

However, because of the value of the annual 2-4-1 companion voucher, it is by far the most common card for HfP readers to keep for the long term. I doubt many people who read HfP cancel this card quickly.

Marriott Bonvoy American Express

Most HfP readers who have the Marriott Bonvoy American Express card will have it because of the 15 free elite night credits you receive. This is an annual benefit, and anyone who gets the card purely for the elite nights is probably in it for the long haul. The 15 elite nights even count towards lifetime status.

I have this card purely for the 15 elite nights and have done for a number of years now. I have no plans to cancel it whilst this benefit remains as it makes Platinum Elite status easy to earn.

Is the ending of pro-rata fee refunds even a big deal?

The UK bonus rules will still be more generous than those in the United States, where most American Express cards come with a ‘one bonus per lifetime’ rule. You can’t reapply and get a new bonus after two years, as you can here.

My gut feeling is that American Express will see an improvement in the ‘quality’ of cardholders who sign up for The Platinum Card and – for non-HfP readers who don’t understand the value of the 2-4-1 voucher – the British Airways Premium Plus American Express card.

It remains to be seen if blocking British Airways Premium Plus refunds will make the Barclaycard Avios Plus Mastercard more attractive for people looking for their first Avios credit card.

These changes probably won’t make much difference during special promotions. We have seen offers on the British Airways Premium Plus American Express card and The Platinum Card in the last year which were so generous that, even without a fee refund, they would be no-brainers.

What interests me is whether some people will still choose to cancel their cards quickly even when they don’t get a fee refund. This would make sense in some scenarios, since the quicker you cancel, the quicker the two year clock for reapplying comes around.

There is some upside too. It is possible that American Express will increase sign-up bonuses further on its paid cards once pro-rata fee refunds are no longer available because it knows that cardholders are committed to a full year.

Conclusion

You don’t need to rush to cancel any American Express cards by 29th February.

The company IS still planning to end pro-rata fee refunds later this year, but notice will be given. Keep an eye on HfP so you know when this message is released as you may not otherwise be made aware.

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Want to earn more points from credit cards? – April 2025 update

If you are looking to apply for a new credit card, here are our top recommendations based on the current sign-up bonuses.

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You qualify for the bonus on these cards even if you have a British Airways American Express card:

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SPECIAL OFFER: Until 27th May 2025, the sign-up bonus on the ‘free for a year’ American Express Preferred Rewards Gold card is increased from 20,000 Membership Rewards points to 30,000 points. Points convert 1:1 into Avios (30,000 Avios!) and many other programmes. Some people may see even higher personalised offers. Click here to apply.

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Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers: