What's Happening?
American Express has announced significant changes to its Membership Rewards program, which will affect the conversion rates for frequent flyer points. Starting December 15, 2025, the cost of transferring points to certain international airline partners will increase by up to 50%. This change impacts seven frequent flyer partners, including British Airways, Cathay, Etihad, Malaysia Airlines, Qatar Airways, and Virgin Atlantic, with conversion rates shifting from 2:1 to 3:1. Emirates will see a change from 3:1 to 4:1. These adjustments follow recent changes to Emirates Skywards and Singapore Airlines KrisFlyer rates. However, there are no changes to American Express's co-branded Qantas and Velocity cards, nor to Business Ascent, Corporate Choices, Corporate Membership Rewards, and Corporate Spirit programs. Additionally, Thai Royal Orchid Plus will no longer be a transfer partner, replaced by Everyday Rewards, which will allow point transfers for shopping at Woolworths and other associated stores.
Why It's Important?
The changes to the Membership Rewards program by American Express could significantly impact cardholders who rely on these points for travel benefits. The increased conversion rates mean that cardholders will need more points to achieve the same travel rewards, potentially reducing the value of the program for frequent travelers. This move may affect American Express's competitive position in the credit card market, as it was previously known for having the most airline points transfer partners among major U.S. credit card loyalty programs. The decision could lead to dissatisfaction among customers who value the flexibility and benefits of the current rewards system. Additionally, the introduction of Everyday Rewards as a new partner may not fully compensate for the loss of value in airline transfers, as the conversion rates are less favorable.
What's Next?
Cardholders have until December 14, 2025, to convert their points at the current rates before the changes take effect. This provides a window for customers to plan and book travel or transfer points to preferred airlines under the existing terms. American Express has not provided detailed reasons for the changes, citing a need to maintain choice and value in redemption options. However, factors such as the cost of frequent flyer programs and potential regulatory changes to interchange fee caps may have influenced the decision. Customers and industry observers will be watching closely to see how these changes affect American Express's market position and customer satisfaction.
