The Evolution of Credit Card Rewards

How the Rewards Game is Shifting

So much has changed in the last few years, and the world of credit cards has been no exception. While the credit card has seen a pretty extensive evolution from its first iteration in the 1930s to today, it has remained fairly consistent for the last twenty years. It wasn’t until the COVID-19 crisis that a new shift began to take place. The biggest changes have been in the way credit card companies are rewarding their customers.

The idea of credit card companies offering incentives and rewards can be traced back to the 1980s when Discover and American Express began offering things like cashback and “Membership Miles.” While rewards programs were rare perks at first, they have now become an integral part of the credit card world. 

When the global pandemic hit, everything began to change, including our spending habits. Travel became extremely limited during 2020 with heavy restrictions placed on both domestic and international flights. The World Tourism Organization estimates a decline of 74% with over 1 billion fewer international travelers than in 2019. With this massive decline in travel, rewards such as cashback on fuel and hotel stays and perks like airline miles became a lot less enticing. Credit card companies had to think fast and reshape their rewards programs to better incentivize their customers.

Emphasizing Everyday Spending

One of the big changes that came from this crisis was a new emphasis on everyday spending. Instead of remaining largely travel-exclusive, rewards programs have broadened their categories to include grocery stores, clothing stores, and online shopping. While travel declined, e-commerce soared, and many credit card companies adjusted accordingly. 

  • The Chase Sapphire Preferred card continues to offer travel perks, but it also offers 3x points on online grocery purchases, dining, and streaming services. 

Traditional travel perks like earning airline miles, free checked baggage, and discounts on car rentals and hotel stays are still a big part of the rewards equation, but many cards have begun to offer them with more flexibility. Many travel credit cards allow accumulated perks and miles to be saved and redeemed at a later date or converted into cashback if unused.

Cards like the United Club Infinite Card, Capital One Venture Rewards Card, Bank of America Travel Rewards Card, and more still offer great travel perks with miles that no longer expire and many allow miles to be renewed on any date without restrictions or blackout dates.

Maximize Rewards with Kiwii

As a credit card user, you want to make sure you are getting the max amount of rewards for each purchase you make, but it can be difficult to keep track of which card offers which rewards. That’s why we invented Kiwii.

Kiwii is a free Chrome extension that ensures you get the most rewards out of each online purchase. It doesn’t require any personal information, either. All you do is select the types of credit cards you use, and then shop online like normal. At checkout, Kiwii will recommend the best card to use to maximize your rewards. It’s that easy! Download it free today.

Article written by Chloe Allen in association with Nouvel Age Media.