Is it possible to lose your Reward Points?
You’ve studied our site long and hard, you’ve applied, you’ve paid your annual fee, and you’re looking forward to those rewards points coming in. Nothing could be simpler. But what happens if you lose those points, or if a card suddenly withdraws its best offers? What can you do?
That’s certainly possible, as we’ve heard in the last month of at least one bank in the United States that announced the end of its previously attractive package of benefits. Bank officials said that while accounts would continue to run normally, they just didn’t have the financial capacity to pay out on the rewards earned by its customers, some of whom had spent months and years building up points totals.
While such a scenario is mercifully incredibly rare in Singapore, you have to keep at the back of your mind that while you’re collecting transaction points on your card, most banks reserve the right to change the terms and conditions of their accounts at any time – and that might mean an end to the perks package that you’ve been using.
The problem is this: You don’t own your reward points. The bank owns these imaginary beasts, and if they do hold any financial value, it’s at some nonsensical rate like 0.001c per point. So you might hold thousands of points, but if you ask for them in the form of actual money, you’ll receive a few cents in the post.
Banks and credit card companies view rewards points programs as an extra benefit for customers that are a separate part of the core business of running their accounts. While the very reason you’ve signed up for a particular card is so that you can save up points for free flights, the banks don’t see it that way. The rewards scheme is discretionary and can be withdrawn at any time.
The good news for Singapore users is that rewards programs are a central tool in an incredibly competitive market, and our users get rewards like no other market in the world. The entire market on the island thrives on reward schemes, and we’re certain they’re not going away any time soon.
But to be on the safe side: Use ’em or lose ’em!
Article by Jason Taylor – [email protected]