Credit cards don’t last forever. Sometimes you’ll cancel a card because the bank refuses to waive the annual fee. Or maybe because you signed up for a bonus or free gift, and don’t use the card anymore. Or maybe there’s an unfavorable change in T&Cs or benefits. Whatever the reason, one question I get asked a lot is “what happens to my points when I cancel a credit card?”
There are two possible scenarios here:
Scenario A: Bank pools your points
If your bank pools your points, you have very little to worry about.
DBS, OCBC, UOB, Maybank and American Express pool points from different cards together. So if I hold a UOB Preferred Platinum Visa, a UOB PRVI Miles Mastercard and a UOB Preferred Platinum AMEX, the UNI$ will pool into a central “fund” that I can then use to do redemptions (which means I’ll only need to pay one redemption fee when cashing out my points).
When I cancel a card with one of these banks, assuming it’s not the only points earning credit card I hold with them, my points on the cancelled card are unaffected as they’re already in a central pool.
For example, if I hold an AMEX Rewards and a AMEX True Cashback card, canceling the AMEX Rewards means forfeiting my points because the True Cashback doesn’t earn Membership Rewards points. But if I hold an AMEX Rewards and an AMEX Platinum card, I can cancel the former without having to cash my points out.
The one exception to this rule is DBS. Although points from your different DBS cards pool when redeeming rewards, points are tagged to a specific card which means you’ll need to transfer them out before cancelling a card. That means that DBS is more akin to the banks in Scenario B…
Scenario B: Bank does not pool your points
If your points don’t pool, you’ll have to redeem them before cancelling your card.
With Citibank, Standard Chartered and HSBC, points do not pool among cards. That’s to say, if I have a Citi Prestige and a Citibank Rewards Visa card, both earning Citi Dollars (sometimes called Thank You points- Citibank hasn’t got consistent about the nomenclature), I cannot combine the points when doing a redemption. That means having to pay two separate conversion fees, and it’s really annoying.
It also means that if I were to cancel my Citibank Rewards Visa card, I would need to transfer out whatever points balance remains attached to that card or risk forfeiting it.
Avoiding orphan balances
If you fall into a Scenario B situation (or use DBS), you need to take into account the minimum cashout amount for miles conversions:
- Standard Chartered- 2,500 SCB points (1,000 miles) [3,500 SCB points (1,015 miles) if you do not hold the Visa Infinite card)
- Citibank- 25,000 Citi Dollars (10,000 miles) [10,000 Citi Miles (10,000 miles) if you hold the Citi PremierMiles card]
- HSBC- 5,000 HSBC points (2,000 miles)
- DBS- 5,000 DBS points (10,000 miles)
If you don’t hit the minimum block required to transfer your points to air miles, you’re going to have to settle for cashing out your points in a sub-optimal way like statement rebates or shopping vouchers. That’s why if you’re set on earning miles and plan to cancel a card in the near future, it might make sense to check the points balance on said card and see if you can top it up just enough to the next cashout threshold.
Neither of the above scenarios apply to you if you own cobrand cards like the KrisFlyer Ascend AMEX or KrisFlyer Blue. In those cases, the miles you earn from spending are directly credited to your KrisFlyer account, and cancelling your card has no impact on the miles in your account.
If you’re just starting out in the miles and points game and found the above article helpful, do consider attending our Miles for Beginners course, where you’ll learn all this and more.