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How the COVID pandemic has changed credit cards

Many of America’s best travel rewards cards have shifted toward rewarding purchases that are more in line with staying home

Summary

With travel advisories in affect, many of America’s best travel rewards cards have shifted toward rewarding purchases that are more in line with staying home. Read on to learn more about how credit cards have adjusted to COVID-19.

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Since the COVID-19 pandemic began in March, you may have noticed subtle and not-so-subtle changes to some of the most popular credit cards.

With travel advisories in effect, many of America’s best travel rewards cards have shifted toward rewarding purchases that are more in line with staying home. However, this isn’t the only way credit cards have adjusted to COVID-19.

Sign-up bonuses ramp up after brief stalling period

In March and April, banks were concerned that people wouldn’t make payments, and new sign-up bonuses disappeared.

“Offers more or less stagnated and we didn’t see anything happen on that front until this month,” Nick Serati, co-founder of The Thrifty Traveler, said in September.

For example, at the end of March and beginning of April, American Express’s Delta SkyMiles cards were offering 100,000 SkyMiles for new sign-ups (after meeting specific spending requirements), but eventually offers like this were replaced by welcome bonus extensions.

However, since more people didn’t default, fall welcome bonuses broke records:

CardSpring 2020 bonusFall 2020 bonusSpring 2020 valueFall 2020 value
Chase Sapphire Preferred Card*60,000 points when you spend $4,000 in the first three months80,000 points when you spend $4,000 in the first three months$750 when redeemed for travel through Chase Ultimate Rewards Portal$1,000 when redeemed for travel through Chase Ultimate Rewards Portal
Capital One Venture Rewards Credit Card50,000 bonus miles when you spend $3,000 in the first three months100,000 bonus miles after spending $20,000 in the first 12 months (though you can still earn 50,000 bonus miles when you spend $3,000 in the first three months)$500 towards travel$1,000 towards travel
American Express® Green Card*30,000 Membership Reward points when you spend $2,000 in the first three months45,000 Membership Reward points when you spend $2,000 in the first six months (offer may not be available to all applicants)$300 on flights$450 on flights

Serati said banks think the worst is behind them and according to Brian Harris, executive creative director at Bradley and Montgomery, these large welcome offers are meant to reignite interest in the travel category.

“Consumers may be starting to see a light at the end of the tunnel … there could be a consumer mentality to start stockpiling travel rewards for the moment that they feel confident to travel again,” Harris said.

See related: How to travel during a pandemic

From going places to gas and groceries

As sheltering in place, keeping your circles small and your interactions to a minimum became standard practice across America, it’s no surprise that credit card issuers took advantage of the change in spending habits that resulted.

“The overall trends are definitely focused more on lifestyle and shopping from home, not so much vacation and travel,” said Scott Bates, blogger at Money and Bills. “Instead of hotel and airline points, you get perks for using a credit card for purchasing goods on Amazon, or using it for subscription services like DoorDash, Netflix and the like.”

In normal times, consumers can justify paying a high annual fee for a premium travel card because it may offer hundreds of dollars in travel credits. But with next to no one traveling, the justification for this fee must come from other benefits.

For example, the Platinum Card® from American Express, which carries a $550 annual fee, is offering up to $320 in statement credits on select streaming services and wireless telephone services when purchased directly from U.S. providers, through December. It also offers up to $200 per year in Uber Cash for rides and delivery.

But it doesn’t stop at streaming and delivery. This new normal has created unconventional partnerships with popular emerging small businesses like Calm (a meditation app) and SimpliSafe (home security). From Nov. 2 to Dec. 31, Amex members who spend $200 or more with SimpliSafe will get a $50 statement credit.

Here’s a breakdown of pandemic-related lifestyle offers we’re seeing on some high-end travel cards:

CardRewards and bonusesOffers added during the pandemicAnnual fee
The Platinum Card® from American Express
  • 5X points on flights booked directly with airlines or with American Express Travel (starting Jan 1, 2021 earn 5x on up to $500,000 on these purchases per calendar year)
  • 5X points on hotels booked at AmexTravel.com
  • Up to $200 in annual Uber credits
  • Up to $200 airline fee credit
  • $20 per month on select U.S. streaming services (through December 2020)
  • $20 per month on cellphone bills (through December 2020)
  • 10X points on U.S. gas station and supermarket purchases during your first 6 months of card membership (up to $15,000 in purchases, maximum)
$550
Chase Sapphire Reserve
  • $300 annual travel credit
  • 3x points on travel and dining
  • 50% in travel redemption when redeemed through the Chase Ultimate Rewards portal
  • 10X points on Lyft through March 2022 (7x plus the 3x already earned on travel) Plus, one year of complimentary Lyft Pink ($199 value) through March 2022
  • Up to $120 in statement credits on DoorDash through December 2021 and one-year DashPass membership
  • “Pay Yourself Back” by Redeeming Ultimate Rewards for grocery, home improvement and dining (including takeout or delivery) through April 30, 2021
$550
Citi Prestige®*
  • Access to over 1,000 airport lounges through PriorityPass Select
  • 5X points on air travel and restaurants
  • 3X points at hotels and cruise lines
  • 1X points on all other purchases
  • Use ThankYou Rewards toward cash back or to make minimum payments through Nov. 7, 2020
  • Supermarket and restaurant purchases count toward $250 annual travel statement credit (through December 2020)
$495
U.S. Bank Altitude Reserve Visa Infinite Card*
  • 5X points on prepaid hotels and car rentals booked directly in Altitude Rewards Center
  • 3X points on travel purchases and mobile wallet spending
  • 12 complimentary Gogo in-flight wifi passes per year
  • PriorityPass airport lounge membership
  • 3X points on takeout, food delivery and dining through December 2020
  • Takeout, food delivery and dining are eligible for $325 annual travel credit reimbursement through December 2020
$400

No breaks or balance transfers

Though credit card issuers modified welcome bonuses and financial aid is available, you aren’t likely to find breaks on interest rates, annual fees or balance transfer rates as banks look for more money.

“The Capital One Venture card has always waived its $95 annual fee in the first year, but we saw cards getting rid of the first year annual fee waiver back in April, May and June. The reason for that is they’re trying to make additional money at a time where there wasn’t a lot new credit card money to be made,” says Serati.

Lauren Bringle, an accredited financial counselor at Self Financial, noted that the pandemic is causing credit card issuers to be more wary about who gets credit and how much they receive.

“Some card companies have raised minimum credit score requirements to gain access to a card, lowered credit limits, and eliminated or reduced balance transfer bonuses,” Bringle said. “Lenders are being more risk-averse than ever, meaning as a consumer, you need better credit than ever.”

See related: What to do if your credit limit is decreased

Are these changes here to stay?

If anything, the COVID-19 pandemic has served to shake up long-standing and popular travel cards that haven’t adjusted their benefits in a number of years. Some are predicting these non-travel purchases that can be put toward travel rewards or statement credits will be permanent features long after the pandemic is behind us.

“It’s like Pandora’s Box – it could be difficult to shove all of those new features back into the box when people have become accustomed to having them,” says Steven Dashiell, credit card analyst at Finder.

*All information about the Chase Sapphire Preferred Card, the American Express Green Card, the Citi Prestige and U.S. Bank Altitude Reserve Visa Infinite Card has been collected independently by CreditCards.com. These cards are no longer available on our site.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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Credit Card Rate Report Updated: November 25th, 2020
Business
13.91%
Airline
15.50%
Cash Back
15.85%
Reward
15.75%
Student
16.12%

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