Good morning everyone, I was looking through my recent American Express statement and saw an ominous message on my American Express EveryDay Credit Card. The message said, “See page 5 for a Notice of Change to the Membership Rewards Program Terms & Conditions.” Uh oh, that sounded pretty bad. I cautiously scrolled down to page 5 expecting the worst. What did American Express do?
Here are the new changes to the American Express Membership Rewards Program, effective immediately. You will no longer earn Membership Rewards Points for “purchases of cash equivalents” (which means gift cards) and “person-to-person payments”. I’m not sure if American Express is referring to Visa / MasterCard Gift Cards or retail gift cards (Chipotle, Macy’s, Southwest Airlines, etc.). The 3 person-to-person payment methods that come to mind are Venmo, PayPal, and Zelle. Since PayPal can be used to pay anyone online for goods and services, I don’t think American Express is referring to PayPal. Zelle can only be funded with bank transfers, so that leaves just Venmo. I have used Venmo in the past to meet minimum spending requirements, even though there is a 3% fee to pay with credit cards.
I tried to find more details on “cash equivalents” and “person-to-person payments”, so I went to the American Express Membership Rewards Terms & Conditions page. Unfortunately, American Express does not provide more details of what is not eligible to earn Membership Rewards Points. Therefore, it is up to American Express’s discretion on what transactions fall into those categories.
I checked my recent statements for my American Express Old Blue Cash and my American Express Blue Cash Everyday and neither of those statements have this change of terms, so it looks like cash back earning credit cards are safe (for the time being), but I wouldn’t bet on that lasting for very much longer. If you have any questions about these changes, please leave a comment below.
Interesting that they put that language in there. I wonder if they can see the purchase info for stores like Vons. Their POS systems don’t seem that sophisticated/updated.
I think it’s just going to be a trial and error process to see what is given and not. Probably not too different than the ATT Access More threads.
I’m not sure they have level 3 data on all merchants, but they can probably assume transactions that are $504.95 or $505.95, or some multiple of that, are gift card purchases. It’s just a big cat and mouse game between us and the banks.
Maybe buy a visa gift card for $487.82(or something like that) instead then?
That is worth a shot :)
So the question now is will they refuse points for their own gift cards they advertise via Amex Offers? And if not, then it is reasonable for the average consumer to assume they would not do so for Visa and Mastercard gift cards either, no?
On my last statement I got the extra points for Visa GC bought in January.
In the AMEX MR T&C section, it says “American Express Gift Cards purchased online” are excluded. I believe you do not earn MR points for those purchases, but you can earn “bonus” MR points for those purchases. Does that make sense? I don’t think Visa and MC GCs are safe either.
Does this hold true for non-MR earning cards?
Not that I can tell. My 2 cash back earning AMEX CCs did not have this T&C change, so I think those CCs are safe for now.
What will be with mpx?
I’m not sure, I don’t use MPX very often.
didn’t see it on my BB+ statement from 2.23 or SPG Biz on 2.13. delayed rollout or personal cards only?
I think SPG has their own T&C, so that might be fine. As for your Blue Biz Plus CC, my statement closes on 3/7, so I should know in a few days, but since that CC earns MR points, I think it has the new T&C.
Well if they start doing this now or eventually, imagine the number of people who close their accounts and are no longer customers. That could be a lot of annual fees and ongoing interchange fees for all the gift card purchases that Amex misses out on. And the massive charges from late fees, over the limits fees and interest for those who don’t pay in full on time. And all that business ends up with their competition.
Very true, but I’m sure AMEX did some calculations that show that they will still come out ahead with less gamers using their CCs.
Well, actually, Chasing points, I would bet that AMEX is not worried about losing these clients. It is obvious that these cardholders (members) are very focused on only doing transactions that benefit themselves at the expense of AMEX.
Unfortunately that’s simply not true. These awful anti-churning rules actually save CCCs money bc churners are a very very small percentage of customers. As they say re: shutdowns/blacklists, you didn’t fire them, they fired you. We are powerless.
They added these terms to Old Blue Cash a few years ago, and they were successful at excluding some but not all 5% gift card purchases. If I recall correctly, CVS was hit and miss. But after they decapitated it at 50K per year, these exclusions seemed to fade away.
Good to know, thank you for the reminder.
Thanks for the heads up! Won’t be renewing my PRG in that case. Wish I understood the economics of those transactions. Clearly someone makes money on the gift card cash equivalents or they wouldn’t be so ubiquitous.
Seems like this will be the death knell for PRG. Without the unlimited 2x for groceries what’s the rationale for keeping this?
Yes, exactly. I don’t think anyone is losing money, except for the gift card vendors who are hoping to get lots of swipe fees, but I don’t think AMEX is losing money.
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Not sure if this is new but it doesn’t seem to be limited to MR cards since I’m seeing this on SPG business card now:
https://www262.americanexpress.com/business-card-application/starwood-preferred-guest-business-credit-card/tandc/30215-AJTnC-0/?key=tncBody#OfferTerms
“Eligible purchases do NOT include fees or interest charges, cash advances, purchases of travelers checks, purchases or reloading of prepaid cards, purchases of gift cards, person-to-person payments, or purchases of other cash equivalents. Additional Card Members on your account are not eligible for this offer. Your account must not be canceled or past due at the time of fulfillment of any offers. American Express reserves the right to modify or revoke offer at any time.”
Ya, looks like they rolled it out to Membership Rewards earning credit cards first and then to all other American Express credit and charge cards. Thank you for the update.
I know this one sounds bad, but I wonder if it’s just another tool for them to use if they really want to target someone really abusing the system. They might like to have this language in their Rewards Abuse Team’s arsenal.
However, for the bulk of the transactions, it seems like I don’t think they’d be able to tell exactly what’s going on. Granted I’m no expert in what information they receive now on each transaction.
One possible way to get around this is to buy something at a store, then return it back and ask for store credit. It’s more work and trouble to do, but it should work. I’ve done it in the past for OSH when I bought an item with an amex offer that ended up not working out so I just returned it for store credit and used it another time. Split pay should technically still work for this as well.
But from a practical perspective, I don’t think most amex credit cards or amex offers are the target of this rule. Amex is still getting 2%+ for the swipe fee from the merchant. The only one that this should target is the Everyday Plus since that pays out 1.5 MR per transaction and maybe the PRG at supermarkets. Most definitely Amex Plat for the 5x since they get the level 3 data probably. I think for the Delta branded cards they need the swipes as well so I think they won’t care as much.
Those are very good assumptions. No one really knows what American Express ca and can’t see.
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I just wonder why they care. If I spend $500 on a cruise or car repairs or whatever or I spend $500 on a Visa gift card or other cash equivalent they still get the same transaction fees I think. maybe they figure if you spend $500 on a prepaid Visa card that means you won’t be putting $500 on my American Express card and they won’t be getting the transaction fees on that money. But they’re still getting the transaction fees on the prepaid card so that doesn’t really make sense. Seems like they’re just shooting themselves in the foot.
I’m sure AMEX has their reasons, probably related to fraud or something.