Are Credit Card Rewards Programs Too Complex? - Roundup #11

Jason Steele
May 04, 2018
Jason Steele CardCon

Jason Steele addresses a question that many people have asked when it comes to rewards credit cards and their programs. As the landscaped has evolved, have the specifics of the programs themselves become increasingly difficult to decipher for the consumers using them? Let's see what the experts say:

Are credit card rewards programs too complex?

This week's contributors are Susan Johnston Taylor, Eric Rosenberg, Ben Luthi, Andy Shuman, Richard Kerr, Debra Schroeder, and Russ Nauta:

Susan Johnston Taylor - Covers money and credit cards for major US media outlets

Many credit card rewards programs are frustratingly complex with a dizzying number of transfer partners and redemption options. You may have multiple options if you want to redeem rewards for a flight. For instance, you could transfer your points to a specific airline, redeem through that credit card's travel portion or pay with that credit card and use rewards to cancel out the charge. The value of your rewards redemption can vary depending on the flight and the option you choose, so if you really want to get the best value, you need to calculate the value of your points under each option and choose the one that gives you the most bang for your buck. Of course, transferring rewards from a credit card to airline locks those rewards into that airline and may carry other restrictions, so you don't want to transfer rewards speculatively.

These complexities may be why some cardholders never redeem their rewards (which is a shame). Some rewards seekers like spending lots of time tracking their rewards, comparing redemption options and squeezing as much value from their rewards as they can. It's a hobby for them, and they join forums and Facebook groups to compare strategies with each other. If you don't have the time or patience for that or you don't travel much, you might be better served with cashback credit card. You may not get as value from earning straight cash back, but it's better to earn a simple one percent on purchases than to accumulate a bunch of points or miles that you never use.

Eric Rosenberg - Finance, travel, and technology writer at Personal Profitability

Credit card reward programs are a bit too complicated for the average user, but that is probably by design. Experienced rewards users understand that some rewards are more valuable than others, and the card issuers want to offer a range of redemption options that are both exciting to customers and offer opportunities to redeem at a lower cost to the issuer.

For credit card users like you and me, it is important to spend a little time getting familiar with the rewards programs for your cards so you know where you can redeem for the best value. That isn't always a simple answer, but finding the answer is important to maximize the value you get from your favorite cards.

Ben Luthi - Staff writer at Student Loan Hero and a freelance writer

It's hard to generalize because there are so many different rewards programs out there. For people who like simplicity, most cash-back rewards programs are very straightforward.

Once you get into the realm of travel rewards, though, things can get complicated fast, especially if you want to maximize the value you get out of your rewards.

I think the real problem is that credit card issuers sometimes don't do a very good job of explaining the ins and outs of their rewards programs in layman's terms. You have to read the fine print to get all of the details, and even that's not always clear unless you do it for a living.

I've had several people ask me how to redeem Venture miles despite that being one of the simplest travel rewards programs around.

Andy Shuman - Travel and credit card expert as well as author of the Lazy Traveler's Handbook series

Credit card rewards programs can be somewhat complicated, but it doesn’t mean they all are. There are three major kinds of reward programs: co-branded travel rewards programs (airline miles and hotel points), e.g. American Express Delta or Chase Marriott Rewards cards; proprietary travel points programs like American Express Gold or Citi ThankYou cards; and cashback programs represented by Discover it or Citi Double Cash cards.

Travel rewards credit card programs can be very rewarding, but they also tend to be a bit complicated. You might need to learn how frequent flyer and hotel loyalty programs work in order to maximize the value. If you are not ready for diving in (or if you are not a frequent traveler) just use cashback cards. They are as easy as point-and-click. If your card pays one percent cash back, you’ll get $1 for every $100 spent; 1.5 percent – $1.50; 2 percent – $2. If you’re just starting out with credit cards or don’t want a somewhat long learning curve, cashback cards might be your best bet.

Richard Kerr - Founder of Award Travel 101

For the credit card rewards novice, there's no doubt the programs can be overwhelming. It takes a certain type of personality, desire, dedication, and available time to learn the different rules and nuances of every card issuer followed by each of those card issuer’s transfer partners. Heck, the entire points and miles community of enthusiasts and bloggers exists because of the knowledge and experience required to truly maximize your reward points.

Simple programs do exist, but they don’t come close to providing the value that transferable points like Chase, American Express, and Citi offer to cardholders. Because of the complexity and time required, I’ve spoken with countless consumers who prefer a flat percentage cash back card or fixed value currency cards like Capital One Venture Miles or Discover It Miles. I find myself ironically comforted by this because if everyone knew how to get maximum value out of every card, it simply wouldn’t be sustainable for the card issuers.

We saw an interesting statement from Barclays with the release of the Arrival Premier World Elite Mastercard where a Barclays executive didn’t view the new transferable points redemption option as a core benefit of the card. I think the complexity of maximizing the more obscure partners Barclay has along with the odd transfer ratios has a lot to do with that statement. I’m curious to see how the public reacts to the new product and if Barclays does anything to simplify the transfer rates and add more mainstream partners to try and appeal to a broader audience who doesn’t have to spend hours figuring out how to maximize these points.

Matt Schulz - Senior Industry Writer at and founder of Talking in Class

Some credit cards rewards programs are definitely too complex, and they can scare cardholders off.

Sure, there is a passionate subset of Americans that devotes a lot of time and effort to winning the credit card rewards game, but most people don't want to do that. Most credit cardholders simply want an easy-to-redeem cash-back card that gives them a good return wherever and whenever they use it. We all have to-do lists that are 100 miles long, and we don’t have the time to think much about credit card rewards, regardless of how lucrative those cards may be.

When issuers make a card’s reward redemption too complex or too challenging, they give consumers a reason to think twice about applying for that card, and in today’s ultra-competitive credit card marketplace, that’s a problem. For example, the Costco Anywhere Visa Card by Citi comes with appealing rewards. The card gives 4 percent cash back on gas – not just at Costco -- and 3 percent on restaurants and travel. It also gives 2 percent at Costco and and 1 percent back on all other purchases. The problem is that you only receive that cash back once a year, once your February billing statement closes, in the form of a reward certificate that you can redeem for cash or merchandise at Costco.

Of course, it’s easy to understand to some degree. A retail credit card is designed to encourage customers to spend more money in that store, and making the cash back reward redeemable only at Costco does exactly that. Ultimately, however, it seems like a missed opportunity. Easier-to-redeem rewards could catch the eye of non-Costco members and possibly lead to new registrations, while also giving current members another reason to pay a visit.

Russ Nauta - Editorial Principal at

They can be quite overwhelming if you are trying to juggle several different rewards programs all at once. Years ago, before I got really into maximizing earnings through points, I was strictly interested in earning miles and using them on my airline of choice. I carried an airline card with a very straightforward program and it worked fine at the time.

Fast-forward to the present. I still redeem points for the same thing, miles on my airline of choice, but the way I go about transferring points and earning those points on purchases to the highest value is extremely complicated. This is the case because I’m doing it across several different cards.

While rewards programs have evolved and the case could be made that they are confusing at times, the consumer has become so savvy and exponentially more complex. Solving this problem has been attempted by several startups over the past decade but pretty much all have failed. As consumers, we are left with the option of either going with one rewards programs and learning how it operates inside out to simplify our lives, or taking the other path of using multiple cards to their fullest potential and earn more per dollar spent, which usually comes at the cost of being more complicated.


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