American Express Will Be The Exclusive Issuer Of Hilton Cards From 2018 – What This Means For You

Yesterday Hilton announced that starting January 1st, 2018 American Express would be the exclusive issuer of Hilton co-branded credit cards in the United States. Currently Citi also issue Hilton co-branded cards. In recent times American Express have struggled keep co-branded partners. The most high profile loss was Costco to Citi/Visa, they also lost JetBlue to Barclaycard and will likely lose access to Starwood Preferred Guest at some stage due to the Marriott acquisition.

It’s unusual for a brand to have credit card deals with multiple card issuers, the only other one that comes to mind is American Airlines with Citi and Barclaycard and that’s in large part due to the U.S. Airways merger (Barclaycard previously held the U.S. Airways credit card portfolio).

What Will Happen To Existing Citi Cardholders?

The big question is: will American Express purchase the back book from Citi? If American Express does purchase the Hilton back book from Citi then that means all existing Citi Hilton cardholders would be automatically product changed to an American Express Hilton card.

Citi is yet to make a final decision on this. If they don’t sell the back book then Citi would product change their existing Hilton cardholders into a different Citi credit card product (this is what American Express did with their Costco cardholders). If this happens then Citi would be product changing them to one of their own branded cards, for example:

  • Citi Simplicity
  • Citi Double Cash
  • Citi ThankYou Preferred
  • Citi ThankYou Premier
  • Citi ThankYou Prestige
  • Citi Diamond Preferred

Out of those options I’d say Citi Double Cash or Citi ThankYou Preferred are the most likely but it wouldn’t be out of the question for them to create a new product to product change cardholders into.

Should You Sign Up For A Citi Hilton Card?

Citi offers two Hilton cards with the following current sign up bonuses (thanks again to our handy spreadsheet):

  • Hilton Honors (no annual fee card): 40,000 points after $1,000 in spend
  • Hilton Honors Reserve: Two free weekend nights after $2,500 in spend. Annual fee of $95 is not waived

Update: The 24 month rule doesn’t apply to this 40,000 point offer.

It’s important to keep in mind that the Citi family 24 month rule applies to these cards. This means if you’ve opened or closed either of these cards within the last 24 months then you’re not eligible to receive the sign up bonus. I can’t see either bonus decreasing as 40,000 points on the no annual fee card is low (highest is 75,000 and we see that frequently) and best on the reserve is two free weekend nights + $100.

We know that we have until the end of this year and given that the 24 month rule applies to these cards I don’t think making a snap application at this stage makes any sense. I’d be hopeful that we will see better offers on both cards before years end (let’s hope we get some more links without the 24 month language).

Where Does This Leave Citi?

This leaves Citi in an awkward position with no hotel co-branded partner (they do have Expedia, but that isn’t the same). My guess is that Citi will be targeting another hotel partner to replace Hilton, possible options would include:

  • Wyndham
  • AirBnB (not a true hotel brand, but close enough)
  • AccorHotels

I’d love to see an AirBnB or AccorHotels card, I really don’t understand why Accor isn’t in the co-branded card game given how insanely profitable it has been for other brands. Traditionally Citi has had one co-branded partner in each space (e.g one hotel, one airline), unlike other card issuers with multiple partners in the same space (e.g Chase with Southwest, United & British Airways).

Does This Mean We Will See An Ultra Premium Hilton Card?

Late last year a rumor circulated regarding an American Express Hilton Diamond Card. Some people seem to think that this new exclusive arrangement with American Express & Hilton makes such a card more likely. I’d say I agree that it does make it more likely, but I’m not that confident we will ever see that card anymore.

Our Verdict

Hilton is a relatively small player in the co-branded space believe it or not. American Express’ once per lifetime policy will most likely mean that Hilton will cease to be a realistic points option for me. I’m hopeful that Citi will replace Hilton with something even better, I’d be extremely happy with an Accor or AirBnB card from them. Let me know your own thoughts about this change in the comments below.

62
Leave a Reply

avatar
 

  Subscribe  
newest oldest most voted
Notify of
Hadley V. Baxendale
Hadley V. Baxendale

Just product changed my Citi HHonors Reserve card into a Citi Double Cash card. Was offered the option to do a PC to Citi Preferred but declined as I PC’ed my Citi Premier last year to that card.

Did not ask about Citi Costco as I do not have a club near me.

Background.

I pre-spent $10,000 after last year’s billing to obtain the free night certificate this year. (Thank you dear departed NW Buxx!)

My annual fee came up on June’s billing statement and I was advised that I would get a full refund if I called before 37 days had elapsed.

Paid the annual fee as I had about a week to receive the certificate before the drop dead day arrived and I could not get full refund.

Glad to report that cert was e-mailed a couple of days before drop dead date and thus was able to keep cert and get full $95.00 refund of annual fee to appear as a statement credit on new Double Cash card.

So, if you still have enough time and $$ to spend the $10,000 to get your cert THIS YEAR, do so, as you may be able to get the cert and PC and obtain a full refund of annual fee before your drop dead date passes.

UNKOWNS.

Do not know if you are to receive the cert next year — when you spend $10.000 but your but your annual fee would have been assessed next year — remember certs are to be issued after payment of annual fee Therefore, I would not chance it by additional spending on the card, as they may not have any ability to issue such cert next year as a result of the end of partnership –all you would earn would be the HHonors points on such spend.

If however, your annual fee would be due some time this year, then I would go ahead with the spend and expect to bee e-mailed the annual cert after fee payment.

Possible you might get lucky like me and get full refund before drop dead date arrives.

Also, agent claimed that you could get a pro-rata refund on annual fee if after 37 days have elapsed — not sure if this is true, but if so, then you could get some $$ back after receiving your cert if your drop dead date has elapsed.

All bets off after 12/30/17.

Good luck!

Ben
Ben

Anyone know/think its possible to PC the Citi Hilton to a Dividend? What about PCing to a Citi TYPs card first, then PCing to a Dividend?

Anyone know if you are allowed to have 2 Dividend cards?

Jeremy
Jeremy

Can you still apply for the Citi Honors reserve card or is that offer gone? I can’t find a working link on the citi website……

Jmanrunner
Jmanrunner

Unless I am missing it, I do not see any language any more about foreign exchange fees in this link or in the terms and rates page either. However, it does not exclusively state no foreign exchange fees and technically I get a foreign transaction fee but it is credited back quickly. It would be nice to have it cleared automatically.

https://www.americanexpress.com/us/credit-cards/card/hilton-honors-surpass/

farsighted99
farsighted99

No. Amex charges forex fees of 2.7%. I got hit with it once; ever since then I never use the Amex Surpass card for Hiltons when I’m not in the US. I use this Citi Hilton. Which is most of the time. So it makes the Surpass card pretty worthless to me Once this Citi Hilton card is over, I’ll probably be using the Chase Sapphire Reserve which gives you 3% for Chase points).

As a matter of fact, will probably cancel my Amex Surpass card when it comes up for renewal. I hardly use it.

jmanrunner
jmanrunner

Starting in April 2017, I started getting credits for all the foreign transaction fees I received. I have had 7 stays internationally since then and all forex fees have been credited back to me almost immediately.

I signed up for the card knowing there were forex fees. Thirteen stays up to March 2017 all had forex fees. But, in April 2017 that changed and I started seeing full forex credits. In effect, I have not paid a forex fee since that time. They appear and get credited back immediately. It might be temporary or a promotion. Hopefully, it is a sign that the card terms are changing.

Jim
Jim

I just checked my October statement and I have no reimbursement for the forex fees I paid in Germany. Make sure you are looking at the right place. The fees are broken out, but are not reimbursed.

jmanrunner
jmanrunner

This is what it looks like. I just had a stay at the beginning of the month and received the credit. I have been getting credited since April for every stay. Call Amex Customer Service.

CR ADJ – PURCH FX FEE NOV4
CR ADJ – PURCH FX FEE
-$7.58
Reference: #
Category: Fees & Adjustments – Fees & Adjustments
Credit Details
You received a credit for
$7.58

Jmanrunner
Jmanrunner

The Amex Surpass started crediting back the foreign exchange fees in April 2017. I have had 7 international stays since then and all have had the foreign exchange fees credited back. The credit appears within a day of the foreign exchange fee charge.

farsighted99
farsighted99

well, that’s new to me. How come it still shows 2.7% forex charges on their web page for the credit card? How come they haven’t notified their users?

https://www.americanexpress.com/us/credit-cards/personal-card-application/member/terms/hilton-hhonors-surpass-credit-card/36182-11-0/#FeeTable

farsighted99
farsighted99

oh, you have to scroll down in that link until you see Fees. Then Transaction Fees. Then Foreign Transactions.

* Foreign Transaction 2.7% of each transaction after conversion to US dollars.

Andrew R.
Andrew R.

I am anticipating heightened sign up bonuses on both cards in the near future. Citi should have excess points to burn and a desire to lock in new card holders before these cards are discontinued.

farsighted99
farsighted99

well, that sucks! I have both Amex Hilton Surpass and Citi Hilton. Was gonna cancel the Amex card because Amex makes you pay the 3% forex charges when using the card outside the US. Not sure I’d use the Amex card much after the Citi card goes. I’d probably use a card that doesn’t have forex charges. That’s really bad news.

Mike A
Mike A

I’m a Citi Hilton Reserve card member and paid my annual fee about a month ago. I reached out to Citi to inquire if I would be offered a prorated refund of the annual fee when the account is closed by Citi in January. Since Citi is initiating the closure I would expect that they would offer prorated annual fee refunds to any card holders whose card year does not align to the calendar year. However, the representative I spoke with claimed that it’s Citi’s policy not to offer refunds 37 days after it has been billed regardless of whether its Citi or the customer who initiates the account closure. This seems exceedingly shortsighted of Citi to treat cardholders so unfairly. Does anyone else have an experience to share on Citi’s stance that there will be no prorated annual fee refund on the Citi Hilton Reserve card?

Jamie
Jamie

Don’t think that’s true. I recently closed a Hilton Reserve card about 8 months or so into my cardmember year and got like $30 back as a prorated credit on annual fee.

Mike A
Mike A

Thanks Jamie for sharing – I really appreciate it! I reached out to Citi via email to obtain a definitive response in writing and will share that here when I receive it.

Mike A
Mike A

See below for Citi’s noncommittal response to my direct question if it is Citi’s intention to not offer prorated annual fee refunds (if applicable to the card holder) towards the end of the year:

“Accounts in good standing will be moved to a new card account and will not lose the ability to make purchases. We will communicate the new credit card information including anticipated delivery dates and any other pertinent details related to your account prior to the end of this year.”

NinjaX
NinjaX

mike, i really dont get what youre trying to say. this JUST happened. meaning CSR have no fukn clue what finalized terms look like. Citi with their shitty IT probably has no damn clue either.

you must not be a costco CC holder from AMEX. if you were, you would not be asking for definitive answers at this point. matter of fact, this news doesnt mean shit until we get final info which probably wont come out until DEC of this year.

just wait it out man. there are so many more questions unanswered. not just your AF issue.

Mike A
Mike A

Thank you NinjaX – that’s sound advice! You’re quite right that the Citi CSRs are clueless at this point. I had incorrectly assumed Citi would be prepared for cardholder questions like mine. I was taken aback when the CSRs failed to acknowledge my concerns or even validate that the Hilton-Citi relationship would be ending and instead stuck to their usual scripts.

calwatch
calwatch

” If they don’t sell the back book then Citi would product change their existing Hilton cardholders into a different Citi credit card product (this is what American Express did with their Costco cardholders). ”

I don’t think so – I automatically received a Citi Costco card, although Amex was trying to get me to sign up for Blue Everyday Cash every month (except none of the offers were better than the public ones). I let the Amex card close and now my only Amex is a Open Platinum Business, as I don’t really care for the other Amex cards or the high minimum spends to get bonuses. I got SPG for the bonus but cancelled it.

Ryan
Ryan

My entire account transferred from Amex to Citi with its full 9 year history. It removed an account from my Amex (I had 4 accounts with Amex, now 3).

farsighted99
farsighted99

that happened to me too. I have way too many Amex cards for them to give me another. Basically, the account just disappeared. It’s over at Citi now.

Jamie
Jamie

I reached out to Citi on Twitter regarding the annual free night certificate cardmember anniversary bonus on the Hilton Reserve Card after $10,000 spend. At first they sent me a link to a FAQ page they put together about them losing the Hilton card, however that link did not address if I would still get the bonus for this year’s spend (my anniversary date is January 5th). Following up, they said, “I have confirmed the following information. If a cardmember meets all requirements, he/she will receive the anniversary bonus.”

While they didn’t specifically say this, I assume the $10,000 spend would need to be completed prior to whatever date the card ends up going away.

FAQ Page – https://online.citi.com/JRS/portal.c?ID=HiltonFAQPage

NinjaX
NinjaX

yup. thats pretty much it. otherwise its lawsuit time or whatever is left of the CFPB. they will honor the TC up until its migration time. makes the most sense.

PointsPartners
PointsPartners

So should I continue spending on this if my anniversary month is in Sept/Oct 2017?