I know it may seem a bit negative against Amex the last two days if you see the last two posts (which Dustin and I wrote separate from knowing the other was doing it!), but I still love my Amex cards and feel that many present real value.
Amex Updates Terms to Shut Down Reward “Gamers”
Which is good because American Express does seem to only want customers that they can retain and that will give them good business (they are a business, after all). This is very apparent in their spelling out of the terms of one of their cards (so far, the Delta Gold card) that seem to cover them if they want to go after “games” – people that apply for these cards to get the bonuses and generally do not keep them or even return their purchases after meeting the spending threshold (to name a couple of things).
Here is the language (in part – the full text can be seen here):
Purchases to meet the spend requirement do NOT include fees or interest charges, balance transfers, cash advances, purchases of traveler’s checks, purchases or reloading of prepaid cards, purchases of gift cards; person-to-person payments, or purchases of any cash equivalents. Miles will be credited to your account 6-8 weeks after you reach the spend threshold
If we in our sole discretion determine that you have engaged in abuse, misuse, or gaming in connection with the welcome bonus offer in any way or that you intend to do so (for example, if you applied for one or more cards to obtain a welcome bonus offer(s) that we did not intend for you; if you cancel or downgrade your account within 12 months after acquiring it; or if you cancel or return purchases you made to meet the Threshold Amount), we may not credit the welcome bonus to, we may freeze the welcome bonus credited to, or we may take away the welcome bonus from your account. We may also cancel this Card account and other Card accounts you may have with us.
What This Means
So, here is what we can take from this:
- Do not return things that you bought just to hit the bonus (pretty much a given already)
- Be careful about applying for a targeted offer that was for someone else / not public (which has worked before)
- Do not buy gift cards for the rewards (something that they have frozen points for in the past)
- Do not cancel or downgrade your account within 12 months after opening it
- They reserve the right to cancel ALL card accounts, as well as the “offending” card account, if you do any of these things
The first there are understandable. The fourth and fif they ones are more difficult – especially the closing of accounts.
With cards that have the annual fee waived, Amex wants to make sure they can at least get 1 annual fee out of you, that is why they want you for the second year. If you value your relationship and the card’s value, that is not that big of a price (especially since it is very possible to get more than the annual fee back with Amex Offers) – for most cards.
But, if you have the American Express Platinum cards, they put the fee up front. If they start to include such warnings for that card, that is a big decision since many people may not find the value there to hold it for another $450 or $550 (especially since you get 2 airline credits in the first year but only 1 each cardmember year going forward). If Amex starts to enforce that new term on a card like that, it could scare many away from applying for one of the Platinum cards.
What Should You Do?
Of course, you could always cancel or downgrade within the 30 days after the fee hits your statement. That would likely be the best course to go with since you would have had it for 12 months.
One other thing to consider – Amex should not enforce these rules on you for cards you have open right now. If you were planning on downgrading/cancelling something like a Platinum card, you had not applied and approved with that language so they would not have the cover to freeze or close your accounts (not saying they won’t – just that they won’t have the cover).
Amex continues to make it clear that they do not care for the gamers. They want customers that value their products and plan on staying with them for a long time. That’s fine – I get that.
But, they should also realize they need to present continuing value to their customers as well. These new spending offers on their Membership Reward cards are a great first step. But, they need to not make it a final step for customers either if they want this loyalty from their customers.
HT: Doctor of Credit
Editorial Note - Opinions expressed here are author's alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.
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