American Express Killing 50% Rebate on Business Platinum Pay With Points

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Two years ago American Express tested a program where if you found award space on an American or United flight American Express would buy you the ticket for saver award style pricing.

That was way too generous, you might even wind up earning more miles than the ticket cost you on certain premium cabin international awards.

Presumably this helped American Express gauge member behavior and costs and the analytics went into the new benefit for Business Platinum and Centurion cardmembers launched in the fall to receive a 50% rebate on points spent with ‘pay with points’ — where you use points to straight up buy tickets at a penny apiece.

This rebate gave you 2 cents per point in value, the rebate posted quickly, and was hugely popular with members. Apparently it was too popular — and too costly — and American Express has decided it was a mistake.

  • First they slowed down how quickly they would rebate points to you from a few days to 6 to 8 weeks. The longer it takes to get your points back the fewer tickets you can purchase with the feature.

  • Now Zach Honig reports that American Express is going to reduce the 50% rebate for Platinum members down to 35% effective June 1.

  • Along with the reduction in value they’re going to impose a cap of 500,000 rebated points per year.

  • These changes do not apply to the Business Centurion card at this time, and Zach reports that American Express will give 30 days’ notice if they intend to apply the changes to those cardholders as well.

American Express added several other benefits to the Business Platinum card March 30th which I found largely unimpressive. However the Business Platinum’s annual fee remains $450 versus the personal Platinum’s new higher $550 fee.

American Express has been spending mightily to fend off Chase. This killer app rebate feature was apparently spend too far, and no doubt tips the scale for many considering spending on a business card back in favor of Chase’s Ink Business Preferred Credit Card.

Competition in this space is, as American Express is clearly learning, expensive.

Update: If you applied October 5 to present, or you sign up by May 31, you will keep the 50% rebate benefit for one full year rather than losing it June 1.

Amex will lower the business Platinum redemption rebate from 50% to 35% in June. However, new cardholders who signed up for the card since the new benefit was announced on October 5th will continue to receive the 50% rebate for one full year. The same goes for new cardholders who apply now for the Platinum card until May 31.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. The fact we got excited over 2 cent-per-point redemptions, and it even proved to be unsustainable, says a lot about the current state of the points game.

  2. So the full year… would that be from October? or from the sign up date… I upgraded my card from gold to platinum business in January 2017… would i have till Jan 2018? or Oct 2017?

  3. Good thing AMEX cares about older customers. I adopted the card early, July last year, and will apparently lose the benefit on my renewal date. And I say it’s nice that AMEX cares to give me notice to cancel the card when the new annual fee hits… I suppose I’d be bothered more but my last few trips to the DFW AMEX lounge have been very frustrating…too many people, filthy carpet, stagnant food choices, employees clearly not happy to be at work, broken fixtures in the restroom or the restroom closed completely. 2 years ago it was a much different experience in that lounge.

  4. What do you think they got wrong in their model? Did they underestimate how horrible mileage availability and pricing has gotten?

  5. Obviously thi sbenefit appealed to cardholders and in AE’s opinion was overused. Evidentally they felt some people were using the deal over and over.
    Why not keep the benefit with an annual cap?

  6. Wow, its a shame to see this go, but, more importantly, this penalizes long term card holders. Based on your updates, the idea that people who this 50% rebate was enough to incentive to get the card are treated better than those that have been cardholders for years. Very poor play, AMEX. Very poor.

  7. @Trevor Mountcastle – of course the driver of honoring for a year is certainly CFPB risk aversion, although I take the point that offering it for a year should be available to current cardmembers to then if the goal was cardmember treatment but it seems the goal is cost containment since the benefit must have massively exceeded budget

  8. Basically the value prop is now, do I want to be able to transfer some points somewhere, and do I want to pay for a Sky Club membership for just 1 person? Well, I am going to move a ton of spend to the Spark card, where any travel is guaranteed $.02 redemption, as most of my travel is domestic. Undecided on the club. I might pay the fee but Biz Plat is now a backup card at best, with Spark Biz and CSR as priorities, in that order.

  9. Oh well. I had been undecided on whether to keep the business card, but they made it easy for me. It’s not a *bad* deal to get 35% off, as that results in a value of 1.54 cents per point, which is only a bit lower than I would value MR points (and of course you earn miles on the flight to cover that gap). Still a good deal for people who don’t want to mess with award availability I guess, but I reckon most people who read this site aren’t in that group.

  10. I was torn about keeping the card and then they announced the 50% rebate so I decided to hold on to it. Now that the rebate is changing, I am going to bail at the next renewal. What a shame. It was exciting while it lasted.

  11. One more thought (rant :)) – if they had just announced the 35% to begin with, we would not be so irritated. But to give something and then take it away shortly thereafter leaves a very bad impression and does nothing to engender feelings of goodwill towards AmEx.

  12. Infuriating. I agree with @profp, it’s a little shocking that they just offered this and now are taking it away. I had just called wondering why my points weren’t credited to discover that they are waiting 6 weeks (which means we have to stay on top of it). They should have done the analytics on the front end instead of pulling it back. The savings will be about the same as the CSR now and I’ll focus on that…

  13. Amex obviously has really bad leadership who have no clue what they’re doing. First they lose Costco now this. I’ve just accumulated over 2 million points since October and they just got devalued. Worse than that for me is the 500,000 cap. At the very least they should have grandfathered in existing customer or given a 1 year grace period. Obvoiously they don’t care about customers any longer or know what they’re doing.

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