Changes To Earnings Rates On British Airways Credit Card

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Just a couple of days ago I wrote about the British Airways Visa Signature® Card, which I consider to be pretty lucrative.

Why you should get the card

In that post I explained why I’d recommend picking up the British Airways Visa Signature® Card:

  • You can earn 50,000 bonus Avios after you spend $3,000 on purchases within the first 3 months of account opening
  • The annual fee is $95
  • You’re eligible for the card if you haven’t received a new cardmember bonus for this product in the past 24 months (so if you had the card a long time ago you should still potentially be eligible to apply)
  • Avios are arguably the single most valuable points currency for shorthaul travel within the US, given that awards start at just 4,500 Avios one-way; that’s almost invaluable for last minute award tickets on American, US Airways, and Alaska; the value of this isn’t changing with the upcoming British Airways devaluation

American-First-Class-Hawaii-1
Redeem your Avios efficiently for domestic travel on American

What’s changing about the card

Per a letter sent in the mail to card members, the British Airways Visa Signature® Card will be changing the earnings structure for spend on the card.

As of April 30, 2015, the earnings structure on the British Airways Visa will change to the following:

  • Earn 3 Avios for every $1 spent on British Airways purchases and 1 Avios for every $1 spent on all other purchases

So basically they’re increasing the return for British Airways spend, while they’re decreasing the return for everyday spend. That’s a pretty unfortunate move, since on the surface the 1.25x Avios per dollar earnings rate at least set the card apart a bit.

It’s worth noting that the other benefits of the card won’t be changing, including:

  • No foreign transaction fees on purchases made while traveling abroad
  • Travel Together Ticket every calendar year you make $30,000 in purchases using the card

British-Airways-First-Class
Continue to receive a companion certificate after spending $30,000 on the card per calendar year

Why the change shouldn’t really matter

While the British Airways Visa Signature® Card offers a great sign-up bonus, it’s actually not the best way to earn Avios through credit card spend, regardless of whether it offers 1.25x Avios or 1x Avios per dollar spent.

For example, the Starwood Preferred Guest® Credit Card from American Express allows you to transfer points from SPG to British Airways at a 1:1 ratio, and for every 20,000 points you transfer you get a 5,000 point bonus, which also translates to 1.25 Avios per dollar spent. So at a minimum you’re earning the same number of Avios through spend on this card (when transferring in the right increments), and your points are much more flexible.

But you can do much better than that. For example, the Amex EveryDay® Preferred Credit Card accrues Membership Rewards points, which can be transferred to British Airways at a 1:1 ratio. Except the card accrues 1.5x points if you make at least 30 transactions per billing period. In addition to that, the card offers:

  • 3X points at U.S. supermarkets on up to $6,000 per year in purchases
  • 2X points at U.S. gas stations

That means you’re earning 4.5 Membership Rewards points per dollar spent at supermarkets, assuming you make 30 transactions per month and it’s the first $6,000 of supermarket spend in the year. Add in the fact that Membership Rewards sometimes offers bonuses on transfers to British Airways (they recently offered a 40% transfer bonus), and the earn rate gets even better.

Here’s a list of several of the best personal cards which accrue points that can be transferred to British Airways Executive Club (they all offer category bonuses of some sort):

CardCurrent BonusDetails
Chase Sapphire Preferred® Card50,000 Ultimate Rewards points after spending $4,000 within three months, plus an additional 5,000 points when you add an authorized user and they make their first purchase within three months• $95 annual fee, waived the first year
• No foreign transaction fees
• 2x points on travel and dining
The Amex EveryDay℠ Credit CardEarn 10,000 Membership Rewards® points after you make $1,000 in purchases with your new Card in the first three months.
Terms and Conditions apply
• Get 2x points at U.S. supermarkets, on up to $6,000 per year in purchases (then 1X). Earn 1X points on other purchases.
• Use your Card 20 or more times on purchases in a billing period and get 20% more points on those purchases less returns and credits.
Amex EveryDay℠ Preferred Credit CardEarn 15,000 Membership Rewards® points after you make $1,000 in purchases with your new Card in the first three months.
Terms and Conditions apply
• Earn 3X points at U.S. supermarkets on up to $6,000 per year in purchases (then 1X). Earn 2X points at U.S. gas stations. Earn 1X points on other purchases.
• Use your Card 30 or more times on purchases in a billing period and get 50% more points on those purchases less returns and credits.
American Express® Premier Rewards Gold Card25,000 Membership Rewards® points after spending $2,000 within three months
Terms and Conditions apply
• $0 introductory annual fee for the first year, then $175
• Earn 3x points on airfare purchased with airlines, 2x points on gas purchased at US gas stations & groceries purchased at supermarkets
Starwood Preferred Guest® Credit Card from American ExpressEarn 25,000 bonus Starpoints® after you use your new Card to make $3,000 in purchases within the first 3 months. Then, earn an extra 10,000 bonus Starpoints® after you make an additional $2,000 in purchases within the first 6 months. Offer ends 4/5.• $0 introductory annual fee for the first year, then $65
• Get a 25% bonus when transferring 20,000 points to an airline partner

Bottom line

This change is a bit puzzling to me. The British Airways Visa has been working hard to gain market share in the US over the years with mega sign-up bonuses, so I don’t get why they’d make the card less rewarding. I’d assume the extra 0.25x Avios per dollar spent wasn’t breaking the bank for them. I do wonder whether this change was prompted by British Airways or Chase.

Regardless, I still think the British Airways Visa Signature® Card is worth applying for given the sign-up bonus and waived annual fee the first year. And you might as well do it while you’re earning 1.25x Avios per dollar spent.

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Comments

  1. there are a lot of stories of people who either let the companion certificate lapse because they could not find availability, or because the YQ was even higher than they expected (close to $3k RT for two… just obscene).

  2. The Travel Together scheme is useless if they don’t release two seats on the flight(s) one wants in a non-coach COS.

    BA Avios themselves are useless if they don’t release *one* award seat on the flight(s) one wants in any non-coach COS.

    They’ve simply made it too difficult to use Avios; I didn’t even mind the “fuel surcharges” *cough*THEY ARE NOT FUEL SURCHARGES*cough* when availability was decent, but for now it’s “no” to Avios and my current two-for-one cert. will expire early next year.

  3. @Gene

    Ben recently describe good redemption values with Avios for short-haul econ. travel in the US (not sure where you are), so I’m not sure it “sucks.” I’ve raised my complaints already just above your post, so I’ll stop right here. 🙂

  4. I am warming to avios (signed up a few weeks ago). My brother is flying himself, 2 kids and oir parents from UK to US in BA firstclass, first week of August. While the YQ is something that is great availability and only 40k or 60k miles per ticket, I believe. looking through UA I could not get close to that booking.

  5. @ TravelinWilly — I loathe flying in coach, even for less than 651 miles, so those 4,500 Avios awards are useless to me. And, yes the fuel surcharges are a total ripoff, making the Travel Together thing worthless. Add to that the reduced earning rate on non-BA purchases, and that’s why I think this card sucks.

  6. I have both the CSP and the BA card… luckily this gives me a good excuse to cancel the BA next month when the fee comes do.

  7. @Gene

    Thanks for clarifying. You and I are on the exact same page, then. The “fuel surcharges” are a complete scam, but one I could negotiate with myself into paying back when first class awards (I should call them “awards” due to those fees, huh? 🙂 ) were available.

  8. Hmm… Not a big deal. I’ve had the BA Visa for so long, I’d even forgotten it gets x1.25 instead of x1.0.

  9. This is still a good card for me as I use the short haul redemptions from PHL on US and have used the short haul redemptions in Australia and Europe. If spending $9k on this card gets me 9k Avios, I have an award to Toronto saving $600 whereas $9k on SPG doesn’t quite hit the award level yet. I agree 20k on SPG for the 5k bonus is a great deal, for those not spending that type of money on one card then the BA card can get a reward faster for less.

  10. I find it strange that for a change that is going to happen in a matter of days that the Chase website is still advertising the 1.25 earn rate for purchases. My account is only a few months old and I have yet to receive any letter from Chase about the changes, makes me wonder if the new accounts will get a year to earn at 1.25 rate and convert to 1.00 on the anniversary.

  11. sorry to resurrect an old post,

    but today I reviewed my Chase BA card, looks like they didn’t change the earning structure. I’m still getting 1.25x on everyday purchase.

    My $525.45 spending netted me 657 Avios!

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