Posted by Chuck on April 28, 2017
Business Credit Cards

Published on April 28th, 2017 | by Chuck

36

Amex to Reduce 50% Rebate on Business Platinum Cards in June

The Amex business Platinum card rebate will be reduced from 50% to 35% in June, according to Thepointsguy‘s source at Amex.

Amex recently added a benefit to the business version of the Platinum to get 50% back on business class airfare or even economy airfare on your selected airline. This effectively made Membership Rewards points worth about 2 cents per point since after paying 10,000 points for $100 flight you’d get 5,000 points back.

Amex will scale it down to a 35% rebate beginning June 1, 2017. After the change, MR points will be worth 1.54 cents (6,500 points for $100 in airfare = 1.539).

Another negative change coming in June is that there will be a cap of 500,000 rebated points per calendar year which is a blow for heavy users.

Amex has also slowed down the 50% rebate to 6-10 weeks instead of a few days, as we reported earlier today. So we’ll soon be getting:

  1. Less points back
  2. Slower
  3. With an annual cap

The business Centurion card will retain the 50% rebate benefit for now. All of the other new benefits on the business Platinum card will remain (1.5x on $5k+ purchases and 5x points on AmexTravel air and hotel bookings).

Additional Thoughts

I guess if it’s too good to be true it won’t last. Honestly, I’m pretty shocked that they’d roll out a benefit and simply take it away, basically admitting that they made a mistake. Usually, they work it in with some other changes and claim that one thing is offsetting another, etc. Apparently, this one was simply too much to handle.

Mark on your calendar at the end of May to book out any future flights you plan on taking.

It looked for a moment like Amex finally one-upped Chase, and now they are taking it away…Chase Sapphire Reserve and U.S. Bank Altitude points can be used for any flight or travel booking at 1.5 cents-per-point, while Amex Membership Rewards points will be worth 1.54 cents-per-points only on airfare and only on your select airline or business class trips and only via rebate. And the earning side is better with Chase too, in most ways.

On a different note, I’m unsure about the legal aspect here. I’ve gotten the impression that card issuers needs to give 1 year from signup with the current benefits. People who just signed up or who sign up now (yup, Amex website still shows the 50% rebate) should be eligible for at least a year of those benefits.

I wonder if this TPG source is only referring to older business Platinum cardholders, but new cardholders who signed up since the benefit was rolled out will end up getting a full year of this benefit.

Update: This has now been confirmed by Amex support. Any new Platinum business cardholders who signed up since October 5th until May 31, 2017 will receive the 50% rebate for a full year.



36 Responses to Amex to Reduce 50% Rebate on Business Platinum Cards in June

  1. Daniel says:

    Sheesh – One step forward, two steps back with AMEX. I don’t see how they feel they can be competitive in this space.

  2. Bryan says:

    Well, that didn’t take long…

  3. P says:

    I just got approved yesterday for this card! I should’ve waited damn

  4. joE says:

    A little preview of how US Bank too will “update” the perks of their new Reserve CC soon after launch, specifically the x3 mobile payments feature. All “obvious” too good to be true perks have the same outcome.

  5. Lantean says:

    seriously… Amex blows

  6. Blue says:

    Yet another example of “May Hay While the Sun Lasts.” Been true for all variants of the rewards game going back to the late 1990s.

  7. Clint says:

    Any precedent on successfully requesting a full/partial refund of the annual fee due to changes in benefits mid-year?

    • Chuck says:

      I feel like in this case it’s totally justified to ask for a serious rebate on the annual fee, especially if you just got the card now.

      • Tom says:

        I just got the card back in November. A few minutes ago I just called to downgrade to the Business Green Rewards Card ($95 fee) and the rep confirmed that I would receive a prorated refund of my annual fee, but she then told me that my benefits WERE grandfathered in for the first year of cardmembership, so I would still be able to receive the 50% discount until November 2017. I decided to keep the card until then rather than downgrading, as I expect that I will be able to make a few uses out of it before then.

  8. Elias says:

    So glad I did not invest in MR points. Many people moved from UR to MR because of this.

    • Frank says:

      I for one did. My strategy was EDP+Biz because of this benefit. I was already considering going back to UR and now it’s a no brainer.

  9. Frank says:

    The minute this becomes a official I will be calling in to cancel unless I get some serious retention offer thrown my way. Can’t really justify the AF without this benefit.

  10. brteacher says:

    This is “Why Chase is kicking Amex’s butt”, episode 38.

  11. Mark says:

    I always thought MR points were worth 1¢ each toward airfare on the AMEX Travel portal. 50% more would mean 1.5¢ each…35% more would mean 1.35¢ each. How was the Biz Plat’s change last October able to make the points worth 2¢ each?

    • Rand says:

      1/(1-.35) = 1.54
      1/(1-.50) = 2

      • Tim says:

        A practical example:

        You buy a flight worth $1,000 using points. You spend 100,000 points initially at 1c per point, but then 50,000 points are given back to you for the 50% rebate. You effectively spent 50,000 points on a $1,000 flight for 2c per point. After the change, you will get 35,000 points back, leaving you with 65,000 points on a $1,000 flight (1.54c per point).

        This is just the way statistics work depending on whether you’re calculating upwards or downwards. It’s not that they’re worth 50% more, it’s that they cost 50% less. 50% less = 100% more (50% is half of 100%).

        • Mark says:

          Tim — great example. Totally cleared it up for me. I was reading the benefit as “worth 50% more” instead of “50% rebate.” Thanks!

      • Mark says:

        Thanks Rand!

  12. Alex says:

    @Mark, you are correct that it is only valued at 1 cent each, but the benefit was a 50% rebate on the number of points redeemed. Say for example JFK to LAX cost $200 one way, this would cost 20,000 points, but you get 50% back, so net cost is 10,000 points.

  13. Rob says:

    Somebody’s gonna get fired over this when they see the cancellation wave that is coming.

  14. Matt says:

    Trashy move. The benefit didn’t even last a year and they axed it with basically one month’s notice.

    I will not be renewing my Biz Plat. Chase UR’s are simply easier to earn, easier to redeem, and more valuable because I can use that 1.5 cpp on hotels, etc.

  15. WR says:

    It’s ridiculous that a premium card can take your $450 annual fee based on an advertised value proposition and then move the goalposts 3 months later. What’s to stop them from just removing all benefits completely, aside from consumer backlash?

    I know you recently posted that this kind of stuff is legal because it doesn’t violate the CARD act, but I am not so sure. I’m no lawyer, but companies can’t do anything they want just because the CARD act doesn’t specifically outlaw it. There is still civil code, and when you promise X (benefits) in exchange for Y (upfront annual fee), and you don’t deliver on your side of the deal, it seems to me that some recourse should be possible. Citi for example gave a year’s notice before nerfing Prestige benefits.

    Any lawyers here?

  16. secstate says:

    So basically UR is better on the burn side now for paid travel since you don’t have to jump through all the extra hoops:

    No need to earn extra points that will later be refunded.
    Can use on any airline even for economy tickets
    No need to wait weeks for points to be refunded to use again

    Given the changes I really think Amex needs to lose the selected airline for this benefit for economy tickets. That restriction is just plain stupid under the revised program.

    On the earn side UR vs MR will come down to what bonus categories you prefer to some extent.

    I will certainly continue to earn MR as I like their transfer partners for my purposes but I doubt I’ll keep the Business Plat going forward as it other benefits are redundant with other cards I have.

  17. Moldova says:

    Below is copied from a contributor at thepointsguy.com. It makes perfect sense that AMEX will proceed this way to avoid legal issues :

    ————————————————-
    Clarification from an Amex rep:

    If you opened your Business Platinum account anytime between October of last year and May 31st of this year, we will be honoring the 50% Airline Bonus, with unlimited points, for one full year from the date your Business Card was issued. Once that full year has passed, you will start receiving 35% points back on eligible flights, up to a maximum of 500,000 points per calendar year.
    ————————————————–

  18. Vic says:

    This is no surprise. People were abusing the refund loophole to convert points to cash. It is actually Amex’s lousy system to blame.

    If they made such conversion impossible, people wouldn’t have been able to abuse it and this won’t happen.

    • Tim says:

      What’s the refund loophole?

      • Vic says:

        It is already closed. Search on the internet and you’ll see it.

        • secstate says:

          I am well aware of the abuse (and no I did not participate) but I don’t know that, that led to this. The abuse could have been dealt with in other ways fairly easily. It seems pretty clear abuse aside this was costing more than Amex liked.

          • secstate says:

            I will add that it is quite possible the abuse accelerated the process though since it would have got eyes on the costs faster.

          • Adam says:

            Sooo what was this loophole? Tried searching didn’t see anything. So what was it since it’s closed anyways?

          • MontyFC says:

            I think they are referring to the “1 time exception”. Folks were booking flights outside of Amex Travel and then requesting CSR to adjust the price against existing points.

            Some were able to do this even for the non-designated flights.

          • Bo knows says:

            it seems Amex charges your biz platinum card first for the $ amount of flight ticket, then deduct the points, then refund the $ amount. if you cancel the ticket within 24 hours,
            it will refund the $amount instead of refunding the points.

          • Adam says:

            @bo knows – hmm ok but still doesn’t make any sense. in your example say you book a $100 flight, which gets charged to your biz plat, then they deduct 10k MRs from your acct & refund $100 back onto your card. (and then eventually refund 50% of the points so your $100 ticket costs only 5k MRs)

            but your alternative is if you cancel the ticket within refund period, it refunds the money AND deducts the points? that sounds like you lose 10k MRs and don’t even have a ticket to show for it. now even if the 50% bonus posts, you’ve still lost 5k MRs & your card still has a $0 balance ($100 ticket – $100 refund)… so how were they able to cash out MRs? doesn’t compute unless I’m missing something.

  19. Adam says:

    I upgrade my Biz Gold to Biz Plat in October of this year. Wonder if that means I’ll receive the benefit for a year……..ugh, they’re so high maintenance….

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