The CFPB says reducing rewards could be a violation of the law
of ConsumerAffairsThe Consumer Financial Protection Bureau has turned its attention to credit card rewards, which some consumers say are less rewarding these days.
In a policy circular, the CFPB warned that credit card lenders that water down or even cancel their rewards may be in violation of the law.
There are many different types of credit card rewards. Travel cards generally offer rewards based on miles that can be used to pay for future travel. But among the most popular rewards is cash back, with the lender giving the consumer anywhere from 1% to 5% of their purchases.
While cash-back rewards are fairly straightforward, travel rewards can be a little vague.
The CFPB said many consumers apply for cards based on the specific rewards they offer. The bureau says current law prohibits unfair, deceptive and abusive practices in administering rewards. Currently, the bureau says nearly 75% of credit cards offer some type of reward.
Putting a price on rewards
As ConsumerAffairs reported in 2023, credit card rewards are not what they used to be. At the time, hoteliers Marriott, Hilton, and Radisson points were valued at less than a penny while others like Hyatt valued theirs at 1.7 cents each.
The Points Guy, a travel rewards website, publishes a monthly valuation of credit card travel rewards. In its December valuation, it breaks it down this way:
| Program | Reward in cents |
| American Express Membership Rewards | 2.0 |
| Bilt Rewards | 2.05 |
| Capital One | 1.85 |
| Chase Ultimate Rewards | 2.05 |
| Citi Thank You Rewards | 1.8 |
| Wells Fargo Rewards | 1.6 |
Photo Credit: Consumer Affairs News Department Images
Posted: 2024-12-18 13:28:19
