Understanding the Devaluation Dilemma
Point devaluation is an unavoidable reality in the world of loyalty programs. It occurs when an airline, hotel, or credit card issuer increases the number of points required for a specific reward, effectively reducing the value of each point you hold.
For instance, a flight that cost 50,000 miles yesterday might cost 60,000 miles today. This happens for various reasons, including inflation and changes in business strategy. For companies, the millions of unredeemed points on their books represent a financial liability. By devaluing points, they can manage this liability, but for consumers, it means their saved rewards are worth less. The trend in India has been clear, with major banks like HDFC, Axis, and SBI adjusting their rewards structures in 2026, making it harder to extract maximum value.
Adopt an 'Earn and Burn' Mindset
The single most effective strategy against devaluation is to use your points regularly. Hoarding points for a far-off dream vacation is a risky game, as their value is almost guaranteed to decrease over time. Think of points not as a long-term investment, but as a currency that is actively depreciating. This “earn and burn” approach doesn't mean redeeming points wastefully on low-value items. Instead, it means having clear, achievable travel goals and booking them as soon as you have enough points. By consistently using your rewards, you lock in their current value and avoid the sting of a sudden, unannounced devaluation, which has become increasingly common.
Prioritise Flexible Point Currencies
Not all points are created equal. The most powerful way to protect yourself is by collecting transferable rewards from bank programs (like American Express Membership Rewards or HDFC Bank’s SmartBuy platform) rather than locking yourself into a single airline or hotel co-branded card. These flexible points act as a shield. You can keep them in your bank account, safe from any single airline or hotel program's devaluation. When you find a good redemption, you can then transfer the exact number of points needed to book it instantly or within a short period. This strategy gives you the freedom to choose from multiple partners, allowing you to pivot if one program suddenly becomes more expensive.
Know Your Redemption Sweet Spots
While devaluations are widespread, value can still be found. The key is to know where to look. This involves staying informed about which routes, cabin classes, or hotel categories offer outsized value for your points. For example, sometimes a program devalues international business class awards but leaves domestic economy awards untouched. Interestingly, some programs even enhance their value. Air India's Maharaja Club recently reduced the points required for many award flights, with some domestic routes seeing reductions of up to 60% and long-haul business class needing 25-45% fewer points. Staying updated on these changes allows you to shift your redemption strategy towards programs that currently offer the best value.
Stay Informed and Be Ready to Act
In the past, loyalty programs often gave members months of notice before a devaluation. Today, these changes can happen with little to no warning. Following travel blogs, joining online forums like Reddit's 'r/CreditCardsIndia' community, and monitoring issuer communications are crucial for staying ahead. When a devaluation is announced, the best strategy is to act fast. If you have a specific redemption in mind and enough points, book it before the new, higher rates take effect. Many programs even allow you to book speculatively, as award tickets can often be cancelled with no penalty, allowing you to get your points back if your plans change.
