What can you do with American Express Membership Rewards points?

What can you do with American Express Membership Rewards points? Who are the best UK Membership Rewards partners?

Today I wanted to do one of our occasional ‘first principles’ articles where we look at a topic that is regularly discussed on Head for Points but which, if you are a new reader, you might not fully understand.

This is very much an article for beginners who have not yet, or who have only just, applied for their first Membership Rewards-earning card.  This is usually American Express Preferred Rewards Gold which I regard as the best starter card for a miles and points beginner as I explained here.

Amex Gold comes with a very generous bonus of 20,000 Membership Rewards points and is free for the first year. You also receive four airport lounge passes per year and 2 x £5 credits per month to spend at Deliveroo.

What are Membership Rewards points?

Membership Rewards points are a global currency used by American Express to reward users of its charge cards and selected credit cards.

It is important to note that the scheme has different partners and different conversion rates in different countries. You may read, for example, that Lufthansa is a Membership Rewards partner, but this is only true if you live in Switzerland.

More commonly, you may read that the conversion rate from A to B is 1:2, when for the UK card it is actually 1:1.

How do I earn Membership Rewards points?

You earn Membership Rewards points from American Express Centurion, Platinum, Preferred Rewards Gold, Green and their equivalent Corporate and Small Business credit and charge cards.

There is also the Amex Rewards Credit Card – this is the only ‘free for life’ UK card which earns Membership Rewards points.

The earnings rate is 1 point for every £1 spent on the card.  The exception is the Preferred Rewards Gold card – which earns double points on airline transactions and on foreign spend – and on all cards for American Express Travel transactions, which earn 2 points per £1.

By far the most popular Membership Rewards card is American Express Preferred Rewards Gold.  This is due to its good sign-up bonus of 20,000 points and the fact that the first year is FREE.

Heavy travellers can also get value from American Express Platinum, despite the £575 fee, because of its strong benefits package. The sign-up bonus on American Express Platinum is 30,000 Membership Rewards points.

Our review of Amex Gold is here and our review of Amex Platinum is here.

Small business owners may be attracted by the generous sign up offers available for the Business Gold and Business Platinum variants.

It is important to remember that you must retain an American Express charge or credit card which earns Membership Rewards points to retain your Membership Rewards points.  If you are planning to cancel your Gold, Green or Platinum card to stop paying annual fees, you will need to empty your Membership Rewards account.

For simplicity, it is best to transfer your points before cancelling the card.  Strictly speaking, according to the Membership Rewards terms and conditions here (p20), you have 30 days from the day you cancel the card.

There is an alternative.  Getting the free Amex Rewards Credit Card lets you cancel your fee paying card and keeps your Membership Rewards points alive as I explained here.

Where can I spend Membership Rewards points?

Here are the key links to the American Express website:

• the UK Membership Rewards home page is here
• the UK airline rewards home page is here and
• the UK hotel rewards page is here

Here is a summary of the UK airline rewards and which airline grouping each airline is in.

1 Membership Rewards point gets you:

• 1 Avios (into British Airways or Iberia)
• 1 Asia Mile (oneworld)
• 1 Delta mile (SkyTeam)
• 1 Etihad mile (no alliance)
• 1 Emirates mile (no alliance)
• 1 Finnair mile (oneworld)
• 1 Flying Blue mile (SkyTeam)
• 1 Qantas Point (oneworld)
• 1 SAS mile (Star Alliance)
• 0.66 Singapore Airlines miles (Star Alliance)
• 1 Virgin Point (SkyTeam from January 2023)

And here are the hotel rewards with 1 Membership Rewards point getting you:

• 3 Radisson Rewards points
• 2 Hilton Honors points
• 1.5 Mariott Bonvoy points

You can transfer into Club Eurostar at the ratio of 15 Membership Rewards points to 1 Eurostar point.  As we wrote in an article last week, this is currently a very good redemption due to the high cost of cash Eurostar tickets and Club Eurostar’s guaranteed reward availability.

How do I maximise the value of my Membership Rewards points?

There are other reward options apart from airline, hotel and Eurostar points, such as store gift cards and travel gift vouchers.  The list got a lot shorter in 2019 when American Express removed all ‘physical goods’ redemptions. It is no longer possible to redeem for a toaster.

However, in almost all cases, these are based on a simple formula which gets you no more than 0.5p per point redeemed (eg 10,000 points for a £50 voucher).  Some of the easiest ones to use are Amazon and iTunes gift vouchers.

For the truly lazy, you can also redeem your points for a credit against your American Express statement.  This gets you a poor 0.45p per point.

However …..

NEVER redeem for less than 0.66p per point of value

In January 2021, Avios formed a partnership with Nectar.  1 Avios point is now worth 1.33 Nectar points when you transfer them via this page of ba.com.

This had an interesting side effect.  Since 1 Membership Rewards point = 1 Avios, and since 1 Avios = 1.33 Nectar points, and since 1 Nectar point = 0.5p, your Membership Rewards points are now worth a GUARANTEED minimum of 0.66p.

All you need to do is transfer them from American Express to a British Airways Avios account and on to Nectar.  You can spend the Nectar points in Sainsbury’s, Argos or on eBay, amongst other partners.

Because you can get 0.66p per point via this route, there is NO REASON AT ALL to redeem your Membership Rewards points for gift cards or statement credit where you get 0.5p per point at best.

You can beat 0.66p, however

In general, you can get more than 0.66p per Membership Rewards point by transferring into an airline programme.  I value airline miles – very conservatively – at 0.8p to 1p each depending on programme and route, but it isn’t hard to beat this.

Hilton Honors, Radisson Rewards and Marriott Bonvoy points are less interesting as transfer options.

I value Hilton Honors points at around 0.33p so that would be 0.66p per Membership Rewards point based on the 1:2 transfer rate.  I value Marriott Bonvoy points at 0.5p, which means you are getting 0.75p per Membership Rewards point based on the 2:3 transfer rate.  I value Radisson Rewards points at 0.2p following a recent devaluation, so you are getting 0.6p per Membership Rewards points based on a 1:3 transfer rate. None of these are noticeably richer than going via the Nectar route.

However, you can do substantially better than this if you need a hotel room on a peak date in a peak city.  It can still be worth transferring Membership Rewards points across to Hilton and Marriott but only if you have identified a redemption where you know you will beat 0.66p per Amex point.

There is no reason to transfer to Radisson Rewards, since this is now a fixed value programme with each point worth a fixed amount, roughly 0.2p, off your next booking.

When should I transfer my Membership Rewards points?

Unless there is a conversion bonus going on, it makes sense to keep your points in Membership Rewards until you need them. This lets you maximise your flexibility. However, in order to speed up a transfer when you do need one, you can ‘link’ your loyalty programmes in advance.

The ‘link’ process allows Amex to confirm that your loyalty account is correct, and knocks a day or two off the time taken for your first transfer to that programme to be processed. You can do this by going into your Membership Rewards account and doing a dummy transfer for the relevant programme.

Once your accounts are linked, a transfer will usually only take 2-3 days at most. In reality most transfers complete overnight and some partners (Virgin Points, Emirates Skywards, Marriott Bonvoy, Delta SkyMiles, Qantas Frequent Flyer) are usually instant.  I compiled a list of Membership Rewards transfer times with help from Head for Points readers.

Can I transfer to another persons frequent flyer account?

This is a common question – and the answer is ‘No’.  Until recently, the US Membership Rewards scheme let you transfer to an airline or hotel account in any name.  This has never been the case in the UK.

It is possible, if you are transferring to someone with the same surname, it will work with some partners who only verify that the account surnames match.

Historically Nectar and Radisson Rewards transfers did no name matching at all. I don’t know if this is still the case.

Are there conversion bonuses?

We have not seen any UK airline conversion bonuses for the last few years.  Etihad and Singapore Airlines have done ‘unofficial’ transfer bonuses recently, ie ones which are not promoted by Amex directly and are only advertised by the airline.

My understanding is that American Express has been trying to reduce the number of people who redeem for airline miles, as these are substantially more expensive than other options.

There have been modest Hilton Honors and Marriott Bonvoy transfer bonuses in the last couple of years, so they may be making a comeback. Neither was generous enough to justify jumping in without any eventual plan for using the points.

Conclusion

American Express Membership Rewards points can be very valuable.  The key thing is that they offer FLEXIBILITY – you do not need to commit them to an airline or hotel scheme until it is time to redeem.  You can avoid being caught out by scheme devaluations or changes in travel plans.

The option of redeeming to Nectar points, routing via Avios, puts a floor value of 0.66p on your points which is good news.

The big sign-up bonuses on the American Express Preferred Rewards Gold (20,000 points) and The Platinum Card (30,000 points) offer an easy way to get your collection going.

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Want to earn more points from credit cards? – January 2024 update

If you are looking to apply for a new credit card, here are our top recommendations based on the current sign-up bonuses.

In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.

Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers:

For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending.