You’ll get less for your points from 16 November.
If you’re sitting on some Avios or Amex Reward points that you plan to swap to Nectar then this is big news. Here’s what you need to know, and what you need to do.
The conversion rate from Avios points to Nectar points is changing. At the moment you’ll get 400 Nectar points for 250 Avios. But from 16 November 2022 you’ll need 300 Avios points for the same number of Nectar points.
This means the “cash” value of those Avios points drops from 0.8p per point to 0.67p per point. That’s a reduction of 16.25%.
The rate the other way, swapping Nectar to Avios stays the same at 400 to 250.
Why this matters
Since the Avios and Nectar partnership launched in early 2021, it provided a way to boost the value of points earned not just via Avios cards, but also any American Express Membership Reward points.
Since Amex points convert 1:1 with Avios, adding this stage in would also be worth 0.8p in Nectar points, rather than a direct 1:1 swap from Amex to Nectar which was worth only 0.5p.
So the change means the maximum return per £1 spent on any reward card earning either Avios or Amex points drops. Here are some examples from popular cards
|Card||Previous equivalent cashback via Avios to Nectar||Equivalent cashback on new conversion via Avios to Nectar|
|American Express Preferred Rewards Gold card||0.8% to 1.2%||0.67% to 1.01%|
|American Express Platinum||0.8%||0.67%|
|British Airways American Express||0.8%||0.67%|
|British Airways American Express Premium Plus||1.2%||1%|
|Barclaycard Avios Plus||1.2%||1%|
There’s also an impact on welcome bonuses, which represent large numbers of points. Here are some examples of the values you can expect under the old and new conversion rates:
|Number of points||Previous value converted to Nectar via Avios||New value converted to Nectar via Avios*||Relevant cards|
|20,000||£160||£134||American Express Preferred Gold Rewards (standard offer)|
|25,000||£200||£167.50||Barclaycard Avios Plus, British Airways Amex Premium Plus|
|30,000||£240||£201||Amex Platinum, Amex Preferred Rewards Gold (boosted offer)|
|60,000||£480||£402||Amex Platinum (boosted offer)|
What you need to do
If you have any Avios or Amex Reward points that you want to convert to Nectar then you need to swap them ASAP. Remember to swap the Amex points first to Avios and then to Nectar.
However there are limits. There’s a maximum of 50,000 Avios points that can be swapped in a month in a single manual exchange.
You can also set up auto-covert to exchange more points each Monday. This gives you potentially two weeks before the 16 November deadline to swap over up to 25,000 (this is the three-month cap for this method). Remember to cancel the automatic change if you don’t want additional points to go at the new rate.
How this changes the best cashback & reward cards
American Express Preferred Reward Gold
I recently wrote about how a revamp of points on the Amex Preferred Reward Gold card meant if you spend more than £5,000 on the card you’d earn between 1% and 1.2% on your spending via the card – as long as you swapped points from Amex to Avios to Nectar.
That obviously now changes. The range, when swapped in the same way, is now between 0.86% and 1%. That’s still better than most other Amex cards, but you may as well use the Amex Nectar card which gives a constant 1% back in Nectar points for each £1 spent.
The value of the welcome bonus also drops. When boosted to 30,000 points (often 32,000 via a refer-a-friend link) you could previously get as much as £280. That’ll now drop to around £235 at most.
Rather than get 0.8% per £1 spent, it’s now worth 0.67%. But the big impact is on the welcome bonus profit. When boosted to 60,000 points and added to the 6,000 points earned from spending to trigger the bonus, converting to Nectar via Avios will be worth £126 less.
That’s a big drop, though other offers such as £150 restaurant credit help to make it worthwhile. But only when boosted and only as long as you cancel the card to get a pro-rata refund on the fee.
Barclaycard Avios cards
If you have the free version of these cards you’ll now get the equivalent of 0.67% back on spending. That’s still much better than the next best non-Amex credit cards, so I still rate this as the best backup card for d.omestic spending.
However, Chase Bank offers 1% cashback for 12 months on its debit card, so that is a better all round card to use except when you want additional consumer protection provided by credit cards.