When Can a Bank Change My Credit Card Benefits?

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"Reader Questions" are answered three days a week — Mondays, Wednesdays and Fridays — by TPG Senior Writer Julian Mark Kheel.

TPG reader Jordan recently sent us a Facebook message with a question about his new Business Platinum Card® from American Express...

[pullquote source="TPG Reader Jordan"]I just applied and got approved for the Business Platinum card. Do the benefits disappear at some point or are they grandfathered in for the life of the card?[/pullquote]

This question has both a simple answer and a complicated one, so let's take the easy road first and then come back around to navigate the more choppy waters.

First, there aren't any benefits or perks of being a Business Amex cardmember that are limited-time or currently scheduled to end or expire. But credit card issuers always reserve the right in their terms and conditions to change any rules or benefits of its products at any time. While the national CARD Act of 2009 requires customers to be notified of "significant changes" 45 days in advance, that legal phrase does not include changes to a rewards program. So if a bank decides to remove a perk or change a bonus category, you don't have much recourse other than closing the card.

There's one major exception to this rule — the CARD Act and its associated regulations provide consumer protections that restrict banks from altering certain aspects of a credit card during the first year the card is open, such as raising interest rates or fees. But again, this mostly does not apply to points or miles earned with the card.

So the short answer is in life, there are no guarantees. If American Express suddenly decides to eliminate all the perks of its Platinum card and replace the Membership Rewards program with an alternate point currency that can only be redeemed for different types of cheese, it can do it.

But that's the theoretical. Let's delve into some real-life experiences.

The fact is banks use their credit card benefits to lure and keep customers, and while some perks don't last forever, card issuers don't want to make changes so enormous that they would destroy any value in their product. And when a major change is in fact being contemplated, banks will routinely either 1) give significant advance notice of the changes, or; 2) grandfather in existing cardholders to the old terms so that existing customers aren't outraged by a sudden change.

For instance, the Citi Prestige is going to lose some major benefits this upcoming July, when Admirals Club access with the card will be eliminated as well as the ability to redeem ThankYou points for 1.6 cents each for airfare on American Airlines. Citibank knows these are huge changes to the card, so it made the announcement roughly a year in advance. This also protects them from legal claims by people who signed up for the card, paid the annual fee and then didn't get all the benefits they were promised for the entire first year.

On the other hand, grandfathering can sometimes occur when old cards are discontinued. Before the merger between American and US Airways, Barclaycard offered a US Airways Mastercard that in some cases came with a 10,000-mile bonus on every anniversary for the life of the card. After the merger, all the US Airways MasterCards were converted to AAdvantage Aviator Red cards which had new and different benefits, but existing cardholders who had applied with the 10,000-mile anniversary bonus have continued to receive it each and every year.

So Jordan, you most likely have nothing to worry about anytime soon, but if you keep the card long enough, you'll probably see some changes at some point. Though who knows — sometimes changes can actually be improvements!

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