Limits card issuers put on credit card rewards
Advertising Disclosure
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from many credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.
Credit Card Applications » Research » Guides » Travel with Credit Cards » Limits card issuers put on credit card rewards

Limits card issuers put on credit card rewards


Updated: December 26, 2012

By
Add to Favorites:

Credit card reward programs are used by credit card companies to lure customers into applying for these cards and also to tempt them into spending more. However, credit card rewards are not always as rewarding as they seem to credit card customers. Credit card issuers put a lot of limits on these reward programs which in a way undermines the benefits of these reward programs.

Annual limits

A credit card might be promoted for loyalty points that can be redeemed for cash. However, on the fine print credit card companies might end up mentioning that in a given year, you could only redeem a stipulated amount of points and not more even if you have collected a lot of reward points.

Monthly limits

Apart from annual limits, card issuers might also put limits on a monthly basis on how many points you could redeem. Although there is no limit on the points you can collect, you need to know you cannot redeem them even if you have a lot of them.

Select merchants and merchandise

Sometimes the reward programs might be totally useless. Credit card issuers might allow you to redeem your loyalty points in the form of discounts on select merchandise, which you may not even need or want to spend on. Similarly, the points could be redeemable only at select merchants, which you may not prefer or where the items are highly overpriced.

Discounts that can be availed after select purchases

There are some reward programs, which instead of benefiting you will actually end up making you spend a lot more. This means that the reward points can be availed in the form of discounts e.g. only if you have purchases merchandise worth a fixed amount. This means, if you don't purchase anything you lose your reward points and if you want to use them, you have to spend more money.

Expiry

Strict expiration dates are set on redeeming your reward points. Sometimes they expire every month or couple of months. It might not always be possible to redeem every month and if you cannot keep these points to redeem when you want to, they are not really beneficial.

Overall Cap

Irrespective of how many points you have collected, there might be a limit to how many you can redeem or get your cash back for. So although the card is promoted as 5% cash back, the terms might have a cap at 50 dollars per month for example.

Add to Favorites:
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.

Other Travel with Credit Cards Research:

Related Research:

5 Reasons to Get the Capital One Venture Miles Rewards Card

By Herbert Moore, Posted: January 18, 2017

If you’re looking for a great travel rewards credit card—one that offers unlimited earning opportunities, flexible redemption, and lots of perks—look no further. This card from Capital One has you covered. Continue reading

Credit Card Tips For Holiday Shopping 2016

By Herbert Moore, Posted: November 23, 2016

November and December are the busiest months as gift shopping reaches its peak. People rush around looking for the best gifts and the best deals leaving a lot of money in the shops. Holiday season may force you to go over the household ... Continue reading

Credit Cards to Save More on Holiday Shopping

By Herbert Moore, Posted: November 22, 2016

Discounts and special offers are available all year round. Werther you are a bargain hunter or an impulse buyer, make sure you check online discounts and special offers. Also, if you are a cardholder, see if your credit card opens the door ... Continue reading