Customers will see rates drop on popular American Express credit cards from 4 August 2021.
Everytime I make a purchase I try to pay with my cashback American Express credit card. It’s a nice constant earner which slowly but surely adds up over the year. Along with extra offers, it’s easily been worth more than a couple of hundred quid a year.
But from early August the amount you can earn on the two main cashback cards – The Platinum Cashback and Platinum Cashback Everyday – will drop.
Here’s what you need to know, and my thoughts on whether you should switch your card.
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American Express cashback rate changes
Technically there’s only a cut in cashback rate on one card. But there’s a threshold change on the other which also reduces how much money you can make.
The Platinum Cashback card will see earnings on the first £10,000 drop from 1% to 0.75%. You’ll still earn 1.25% on spending past the £10,000 threshold.
The Everyday card keeps the initial cashback rate at 0.5%, but you’ll now earn that much on the first £10,000 you spend rather than £5,000.
|Card||Cashback rates until 3rd August 2021||Cashback rates from 4th August 2021|
|American Express Platinum Cashback card||1% on first £10,000 spent||0.75% on first £10,000 spent|
|1.25% once spend is over £10,000||1.25% once spend is over £10,000|
|American Express Platinum Cashback Everyday card||0.5% on first £5,000 spent||0.5% on first £10,000 spent|
|1% once spend is over £5,000||1% once spend is over £10,000|
How much less will you earn?
Obviously it depends on how much you spend. But let’s look at a few different threshold levels, starting with the £3,000 minimum you need to earn money back on the Everyday card.
I’m not including the welcome bonus in these calculations – more on these in a bit. I’m also not listing spends above £10,000 as those rates remain the same.
Platinum Cashback card
This card comes with a £25 annual fee, but you can avoid this in the first year via a refer-a-friend link or going through a cashback site. Therefore I’ve split this into year one and after year one.
|Spend year one||Cashback (Pre 4 August 21)||Cashback (Post 4 August 21)||Difference|
|Spend year two +||Cashback after fee (Pre 4 August 21)||Cashback after fee (Post 4 August 21)||Difference|
Platinum Cashback Everyday card
There’s no annual fee with this card, but you’ll earn less on the card once you spend more than £10,000 a year.
|Spend per year||Cashback (Pre 4 August 21)||Cashback (Post 4 August 21)||Difference|
Alternative American Express reward cards
As you can see from the tables above, the most you’re likely to lose each year is £25. It’s a decent amount. So can you beat your return with a different card?
The following cards are all reward cards, meaning you get paid in points rather than credit to your card. For simplicity I’ve converted these to the effective cashback rate.
|Amex Preferred Rewards Gold||0.5% per £1||£0 in first year / £125 in year two onwards|
|0.8% per £1 if swapped for Nectar|
|Amex Nectar||1% per £1||£0 in first year / £25 in year two|
|1.5% per £1 at Sainsbury’s|
|Amex British Airways||1 Av|
You can see that the Amex Nectar suddenly looks more appealing. It pays 1% on all spending, albeit in Nectar points. Though you don’t get the extra 0.25% that comes with the Platinum on spending over £10,000, you’re more than earning that on the first £10k. Plus if you shop at Sainsbury’s you’ll earn more on your supermarket shopping.
The Gold Rewards card also could be worth more if you convert your Reward points to Avios points and then to Nectar points (it’s very easy to do). This boosts them from a value of 0.5% to 0.8% – beating both Platinum cards on spending under £10,000.
I’ll update my other Amex reviews and guide in the coming weeks to give a proper comparison.
Amex welcome bonuses stay the same
Some good news – the welcome bonuses on these cards are staying the same:
- Amex Platinum Cashback Card: 5% on first £2,500 spend in first three months (worth £125)
- Amex Platinum Cashback Everyday Card: 5% on first £2,000 spend in first three months (worth £100)
In order to be eligible for either of these you cannot have had an American Express reward or cashback credit card in your name (supplementary cards are fine) within the last 24 months.
However if you can get an Amex welcome bonus I think you’re better off going for the Amex Preferred Rewards Gold. If you do the Amex/Avios/Nectar shuffle you’ll have £186. That’s more than the £100/£125 you get with the Platinum cards. In fact, if you’re referred until 12 May 2021 you’ll get a boosted £280!
You could always start with the Gold card for the duration of the bonus and then open up an alternative card, such as one of the Platinum cards to get potentially higher cashback/rewards.
Should you ditch your Amex Platinum card?
If, like me, you have one of the Platinum Cashback credit cards from American Express you’ll be thinking is there a better option.
Well we can rule out the welcome bonus you get on other cards, so we’re just looking here at what you’ll get on everyday spending.
The obvious winner for most is the Nectar Amex as you’ll get 1% back (as Nectar points). That’s worth £25 more in year one on spending up to £10,000, and slowly reduces the closer you get to a £20,000 annual spend.
You are tied into Nectar points, which means you’ll need to have one of the supermarkets near you (or spend at Argos or another Nectar partner). That should be fine for most people.
However, and this is really important, you don’t get your Platinum cashback until your 12 month anniversary, so don’t cancel your card before then. In fact, if you have the free Platinum Everyday card I’d keep it open even if you do move to a different card as you’ll still get access to those extra offers.
Plus, there’s still time for American Express to change the rate on other cards, so I’d wait until late July before applying for an alternative.
6 thoughts on “Amex cuts cashback rates on Platinum cards”
Very unhappy to hear this news and i may stop using the card soon as a i get my cashback this year as i dont feel this is worth me carrying on.
for me to push myself on a £10,000 a year spend on the old rate i would make £75.00 a year on the Platinum Cashback Everyday card i use this i was happy with , Now i am pushing it all year to make £50.00?
This is not worth my time bye bye i feel American Express i dont want to jump through many hoops a year for £50.00 a year its just not worth my time.
sad to see 🙁
Was only a matter of time – following others that have ‘trimmed’ their benefits. The farthing & groat have effectivly reappeared with some so- called rewards. Would be interesting to have an article featuring the history & features of credit cards that are no longer available. Remember Tandem’s? I once had a card that paid 3% on unused balances, however the general going rate was then around +5%. I’ve noticed recently some retailers now receptive to cash discounts. Pay £100 deposit via cr cd to gain Sect 75 cover.
In my opinion nectar points are as close as you can get to cash. Pseudocashback if you will. Someone living in UK surely at some point will shop on Ebay/Argos/Sainsburys making it effective cashback.
With that in mind you should also consider the British Airways American Express card as the best cashback credit card right now. It’s free for life which makes things simple. It earns 1 Avios per £1 spent, with 1 Avios converting into 1.6 Nectar points.
Nectar Amex is technically better but it has £25 fee after first year, so from 2nd year you’d have to spend more than 13k per year to beat the free British Airways American Express card.
The same goes for the American Express Rewards Credit Card btw. It’s free for life. 1 Rewards point per £1.These convert 1:1 into Avios and then 1:1.6 into Nectar.
Yeah, I’m going to take a proper look at the free Avios card in the coming weeks for a full article but it does seem that if you’re happy to have Nectar points (and don’t shop regularly at Sainsbury’s) it’s a good option
That’s really disappointing to hear – I use the Amex Platinum Cashback myself and this probably will change my intention away from continuing to use it. Following your advice on waiting to see if Amex make other changes….
Yeah. I’d anticipate further changes!