ANZ has killed off American Express rewards cards

Photo: William West / AFP / Getty Images

ANZ has ditched American Express as part of its credit card offerings as it prepares for the Reserve Bank of Australia’s cap on interchange fees.

The move could signal the beginning of the end for Amex cards issued through banks and their appeal to customers enticed by higher rewards earnings.

From July 1, interchange fees — the amount charged between banks for card based transactions — will be capped at 0.8% on all cards.

The move means banks will struggle to offer more lucrative awards points to Amex card holders, which they offset with higher interchange fees.

ANZ stopped offering American Express “companion cards” with new rewards credit card accounts last week and will kill off Amex cards currently owned by existing customers completely from August 5.

“We are making changes to our rewards programs in response to new card payments regulations being introduced later this year,” a bank spokesperson told Business Insider.

“We are writing to customers about these changes to give them plenty of time to understand them and consider any impacts to their card use, especially if they have direct debits set up on their American Express card.”

A fortnight ago, ANZ scored a marketing coup in announcing cuts to the interest rates on two of its cards, saying they were the lowest rates in 14 years.

But in the meantime, the bank has been cutting back on the earning rate for reward points.

While ANZ has removed caps on rewards points for all Visa rewards cards, it introduced a tiered system for earning rewards points from March 1 for new accounts, which kicks in on existing accounts from August 5.

In some instances, it means that card users will have to spend nearly twice as much to earn the same level of rewards, with the initial earning rate capped at certain spend then halved beyond that level.

ANZ’s popular Qantas frequent flyer card changes 0.5 Qantas points per $1 spent, up to $500 monthly, then 0.25 Qantas points per $1 beyond that.

The Rewards card now offers one point per $1 spent for the first $1000 a month, then half a point on every $1 spent. The more expensive Rewards Black card changes from 1.25 points per $1 spent, to 2 points per $1 up to $1000 a month, then 1 point for every $1 spent.

The sign up bonus in the rewards program has also been changed so customers now receive a Westfield voucher if they spend a certain amount in the first 60 days, rather than bonus points.

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