There has been some recent sad news in the rewards card industry. Specifically, Perkstreet, a rewards debit card, has had to close up shop. Luckily, the money in everyone’s account will remain untouched. However, the same isn’t true for the rewards people have earned on their accounts.
If Perkstreet customers had not requested to cash out their rewards prior to the announcement of Perkstreet closing, then their rewards have disappeared forever into the abyss. While some people may have had small rewards balances, I can easily imagine that some people had hundreds of dollars in rewards that they were saving for a particular goal. Those rewards are gone forever with no chance of getting them back.
While Perkstreet was a rewards debit card, rewards credit cards work in a very similar fashion. Most credit cards allow you to earn points which you can then transfer to other rewards programs, or you could turn your points in for check, statement credit or other form of cash back such as a gift card or a prize. Much like Perkstreet, credit cards can make your points vanish just as quickly without any warning.
Credit Cards Can Make Your Points Disappear
When you applied for you last rewards or cash back credit card did you take the time to read the terms and conditions that you agreed to in full? I didn’t think so. I have, and in every single rewards card I have there was a line saying something to the effect of the following:
*Credit Card Company Name* can make changes to the rewards program at any time with no notice. This includes making changes to any rewards balances that have been accumulated.
Essentially, every credit card agreement you sign likely says that they can take away any points you have earned and just make them disappear! This is exactly what happened to Perkstreet customers. Does it suck? Of course it does! But whose fault is it that you let the rewards sit in your account knowing that this could happen one day?
What You Can Do To Prevent This From Happening To You
The first thing you can do to prevent things like this from happening to you is read the fine print on everything you sign. If you did, you’d be aware your points could disappear for no reason at all. You’d also notice that you probably can’t redeem rewards if you’re delinquent on your account… but if that’s the case you have no business having a rewards credit card anyway.
The next thing you can do to prevent your rewards from disappearing is to use your credit card rewards as early as you can. Some people will save their rewards just because they like saving. If you don’t have a planned use for your points get your cash back or statement credit. If you’re accumulating points to use in a more valuable manner, such as transferring them to a partner program, just be aware of the fact that they might not be there when you expect them to be.
Do I See Big Banks Making Your Rewards Disappear?
I don’t see this happening with the big banks that issue credit cards such as Chase, Citi or American Express. These companies would have a huge backlash against them and they could lose a lot of business with their other product lines such as banking and mortgages. Perkstreet was a start up company and weren’t as stable as the big banks issuing the majority of credit cards.
However, if you’re signing up for cards with relatively new companies, small credit unions or banks you might want to be wary. I’m not saying they’ll fold up shop, but there is a bigger likelihood of something similar to what happened with Perkstreet happening to your issuer.
Are you worried about your credit card rewards? Did you have a Perkstreet rewards card?