Reduced AMEX earn rates from April 2019

[albyd]

I think that’s JB HIFI’s way of discouraging the use of Amex as everyone has a backup MC or Visa. Otherwise I find it hard to believe if they really wanted to accept Amex a retailer with the volume they put through can’t negotiate a better rate.

 

[kyanar]

If you are referring to the merchant fees, then vendors would have to reduce any surcharges in line with the fees they pay as required by law. They can only surcharge the actual cost of processing the payment.

Unless it's Amex or Diners. The RBA rules only cover four party acquirer systems (Visa, MasterCard). American Express and Diners Club which are three party systems can make up their own rules - the vendor can surcharge as much as they want, as long as Amex or Citi don't explicitly forbid it in the contract.

 

[Gold60]

Yesterday I received my EDGE change over letter for next April.

as I read it, i get more points for my overseas spend from 1 to 2 points; i get more more Govt expend. and insurances, etc - 0.5 point up to one point. The only downside seems to be the points transfers rate - i transfer from AMEX to KRIS FLYER - and that will halve.

does this match up with other EDGE users ?

not overly happy with the transfer rate to KRIS, but it is what it is, so i have to suck it up like everyone else....

 

[piratematerial]

In terms of transfers to FF partners (and that’s what people are here for, right?), the Platinum Edge has taken a battering when previously it was my one non churn and burner. Supermarket and supermarket partners (eg Dan Murphys, Target, Kmart etc) reduces from 3 to 1.5, petrol reduces from 2 to 1.5, general spend reduces from 1 to 0.5 (considerably less than you can get from a visa/MC), govt stays at 0.5, international stays at 1 (with a 3% tax). Local champion bonus reduces from 1 to 0.5. I was easily hitting 80k points per year on my general spend (government childcare at 1.5 inc local champion) which would reduce to around 40k. I can do pretty much the same on a decent Visa like Amplify or Coles MC without having to brace myself through the pain of using Amex Travel to get most of the annual fee back.

Come April, I’m currently pondering whether to 1) move to a churn and burn 2) move to a direct Velocity earn card or 3) essentially dumping Amex and getting my wife to get a free one + secondary card for offers/Shop Small etc

 

[Gold60]

i wonder why your earn rates from your spend decrease, whereas mine either are unchanged or increase a bit ?

In terms of transfers to FF partners (and that’s what people are here for, right?), the Platinum Edge has taken a battering when previously it was my one non churn and burner. Supermarket and supermarket partners (eg Dan Murphys, Target, Kmart etc) reduces from 3 to 1.5, petrol reduces from 2 to 1.5, general spend reduces from 1 to 0.5 (considerably less than you can get from a visa/MC), govt stays at 0.5, international stays at 1 (with a 3% tax). Local champion bonus reduces from 1 to 0.5. I was easily hitting 80k points per year on my general spend (government childcare at 1.5 inc local champion) which would reduce to around 40k. I can do pretty much the same on a decent Visa like Amplify or Coles MC without having to brace myself through the pain of using Amex Travel to get most of the annual fee back.

Come April, I’m currently pondering whether to 1) move to a churn and burn 2) move to a direct Velocity earn card or 3) essentially dumping Amex and getting my wife to get a free one + secondary card for offers/Shop Small etc

 

[piratematerial]

I was framing it as the effective change for FF transfers. Yes, petrol, internation, govt have gone up for Amex earn rate, it's keeping them as lower than currently (at best equal for govt and international) because the transfer rates have been halved.

 

[Gold60]

aaaaaaaaaaaaaaahhh yes, sorry i see what you mean. it is a bit of a marginal proposition in case isn't it ??

I was framing it as the effective change for FF transfers. Yes, petrol, internation, govt have gone up for Amex earn rate, it's keeping them as lower than currently (at best equal for govt and international) because the transfer rates have been halved.

 

[Renato1]

Okay - so MR points are devalued in terms of transferring them to Velocity and other airline points.

What isn't clear to me is whether they are going to be devalued in terms of buying hotel rooms and experiences at the Amex site - where currently one MR point equals one cent. Will it remain the same, or are they going too double the points needed to redeem a room?

Does anybody have any idea, please?
Regards,
Renato

 

[michael65]

Yesterday I received my EDGE change over letter for next April.

as I read it, i get more points for my overseas spend from 1 to 2 points; i get more more Govt expend. and insurances, etc - 0.5 point up to one point. The only downside seems to be the points transfers rate - i transfer from AMEX to KRIS FLYER - and that will halve.

does this match up with other EDGE users ?

not overly happy with the transfer rate to KRIS, but it is what it is, so i have to suck it up like everyone else....

Yes I got a similar letter. Will transfer most of my points to KF. Suspect I will then cancel the card. The more people that cancel their cards, the better. We need to complain loudly to AMEX. I am also putting negative comment on every Facebook post I see from AMEX. Everyone else should do the same

 

[michael65]

i wonder why your earn rates from your spend decrease, whereas mine either are unchanged or increase a bit ?

The earn rates technically go up. However, it will cost you more to redeem your points. For example, to transfer point to a FF scheme it will now cost 2 MR points per FF point whereas it was 1:1 before.

 

[firstclasser]

Okay - so MR points are devalued in terms of transferring them to Velocity and other airline points.

What isn't clear to me is whether they are going to be devalued in terms of buying hotel rooms and experiences at the Amex site - where currently one MR point equals one cent. Will it remain the same, or are they going too double the points needed to redeem a room?

Does anybody have any idea, please?
Regards,
Renato

Points for Amex travel site is also being devalued by 50%, so for instance 10,000MR is now only worth $50

 

[kooky]

Points for Amex travel site is also being devalued by 50%, so for instance 10,000MR is now only worth $50

Someone said you can now get 2x toasters instead of 1x toaster.
Is this at least true?

 

[firstclasser]

I, like many others, received my letter for platinum card in the mail advising me of doubling of points. The letters I received for my reserve and explorer did not make any mention of doubling of points.
Now that I have it in writing, I will be warehousing my points (current balance 750k) and transfer as I see fit when necessary.
Before I was made aware of the doubling of points, my initial strategy was to be transfer enough points to KF for two one way R/F redemptions to EU, and the remainder to VA with the current 20% bonus.

Once I've eventually used up my balance of Amex MR, I will then have to re-evaluate to see if its worth keeping the platinum charge card. It will still have an effective earn rate of 1.125 points/dollar for KF, so potentially it's keeper.
Even though there are Visa offerings of 1 QF point/dollar, I really don't value QF points anywhere as much as KF and VA due to the exorbitant taxes qantas charges.

As far as people wondering if they'll be eligible for the doubling of points if they apply for the platinum charge card now, I would simply call up Amex and ask them frankly if this is possible and doable. I wouldn't be surprised if they would be willing, as surely it can't be a bad thing for them to sign up new members to their hefty platinum card.

 

[SOPOOR]

Someone said you can now get 2x toasters instead of 1x toaster.
Is this at least true?

Im trying to reduce my carbohydrate intake

 

[hossein_au]

yeah very intersting, even though I dont use RP,

so they have a model thats 100% reliant on the merchant fees of AMEX and demand from customers in terms of reward points

and now with the deval, they may lose more than 50% of their customer demand

I would say that is precisely their business model. With the increase in earn rate for government spend, I wouldn't be surprised if they lose well over 50% of their customers if their fee is not reduced at least by half.

 

[hossein_au]

If you are referring to the merchant fees, then vendors would have to reduce any surcharges in line with the fees they pay as required by law. They can only surcharge the actual cost of processing the payment.

Wasn't AmEx specifically excluded from the said law/regulation?

 

[sjk]

With the increase in earn rate for government spend, I wouldn't be surprised if they lose well over 50% of their customers if their fee is not reduced at least by half.

Not sure that you quite get it yet. Earn rate for government spend has not been increased in any meaningful way.

 

[Mr_Orange]

Wasn't AmEx specifically excluded from the said law/regulation?

You might be right, actually.

 

[hossein_au]

Not sure that you quite get it yet. Earn rate for government spend has not been increased in any meaningful way.

I do get it; earn rate of *MR* points will go up (which means transferring to airlines after the devaluation would result in the same number of airline points as it does today). I was reflecting on the letter they have sent out, which is worded so as to (wrongly) give the impression people will be far better off when paying for government charges and fees.

If the letter was reflective of the reality and without any marketing bull, I would have said RP would lose almost 100% of their customers. I predict they will lose well over 50%, to account for the fact that some (a good proportion?) RP customers will fall for AmEx marketing cough before realising what has actually happened to the earn and transfer rates.

 

[sjk]

I do get it; earn rate of *MR* points will go up (which means transferring to airlines after the devaluation would result in the same number of airline points as it does today). I was reflecting on the letter they have sent out, which is worded so as to (wrongly) give the impression people will be far better off when paying for government charges and fees.

If the letter was reflective of the reality and without any marketing bull, I would have said RP would lose almost 100% of their customers. I predict they will lose well over 50%, to account for the fact that some (a good proportion?) RP customers will fall for AmEx marketing cough before realising what has actually happened to the earn and transfer rates.

Fair enough. I would never have taken that meaning from the following, though.

With the increase in earn rate for government spend, I wouldn't be surprised if they lose well over 50% of their customers if their fee is not reduced at least by half.