BMO is among Canada’s big five banks with a popular portfolio of over two dozen credit cards. So, it’s big news that BMO is making changes to its in-house rewards program as well as altering the earn rates on its Air Miles and CashBack World Elite Mastercards.
The changes are coming soon on May 5, 2021 and we think it’s a bit of a mixed bag. To help you decide if the BMO Air Miles and CashBack World Elite cards deserve a place in your wallet, we’re highlighting the pros and cons of the upcoming changes.
1. BMO Rewards points changes
Currently, you can redeem BMO Rewards points for travel rewards in increments of 140 points for $1 (about 0.71 cents per point or 0.71%).
Starting May 5, however, redemptions for travel will be devalued so that 150 points equals $1 (about 0.67 cents per point).
While that may sound inconsequential, that’s actually a decrease of about 7%, which means it’ll take you longer to earn points to get where you want to go. This point devaluation will impact a roster of credit cards that collect BMO Rewards points, including the recently launched BMO eclipse Visa Infinite and BMO eclipse Visa Infinite Privilege, as well as old staples like the BMO World Elite Mastercard and the no-fee BMO Rewards Mastercard.
There’s some silver lining though. Cardholders will receive a boost in points on May 5 to offset the difference, so points earned prior to May 5 shouldn’t be affected by the devaluation. BMO points collectors can also continue to book travel flexibly for flights from virtually all major airlines with no blackout dates or seat restrictions, as well as for hotel stays, rental cars, vacation packages, and cruises.
Changes to earn rates (when points are redeemed for travel rewards)
BMO eclipse Visa Infinite
|Now||After May 5|
BMO World Elite Mastercard
|Now||After May 5|
BMO Rewards Mastercard
|Now||After May 5|
Redemptions using BMO’s Pay with Points option (which can be applied towards any card purchase made within the past 30 days; like cash back) will continue to be in increments of 200 points for $1 (the equivalent of 0.5 cents per point).
Ok so now that you know what’s happening to travel value of a BMO Rewards point, let’s move on and evaluate the changes coming to the BMO Air Miles World Elite and BMO CashBack World Elite Mastercards.
2. Changes to the BMO CashBack World Elite Mastercard
The BMO CashBack World Elite Mastercard currently earns a flat 1.5% cash back on everything you buy, but earnings will soon change to a more traditional tiered bonus structure effective May 5. The card will then earn:
- 5% cash back on groceries (up to $500 per month)
- 4% on daily transit (up to $300 per month)
- 3% on gas (up to $300 per month)
- 2% on recurring bill payments (up to $500 per month)
- 1% on all other purchases
These changes will make the BMO CashBack World Elite the card with the highest-earning cash back rate for grocery purchases in Canada. Before you get too excited, note that there’s an important caveat: almost all the categories have rewards caps. For instance, in the case of groceries, you’ll earn 5% on the first $500 you spend every month, but on $501 and beyond, you’ll rack up just 1%.
The good news is that the caps for all the categories will reset with the start of each new monthly statement period. The caps are quite low for a premium rewards card, however, which definitely detracts from their initial impressiveness and something to keep in mind if you think it’ll be easy for you to consistently spend beyond those caps each month.
The BMO CashBack World Elite Mastercard’s other perks and features will remain untouched, including its $120 annual fee, complimentary roadside assistance, insurance coverage, and the ability to redeem cash back anytime in increments of as little as $1.
3. Changes to the BMO Air Miles World Elite
The BMO Air Miles World Elite Mastercard will also be undergoing some important changes. The card now earns a flat 1 Mile for every $10 spent or 0.1 mile per $1. As of May, however, that will change and cardholders will earn 1 Mile for every $12 spent and triple the miles when shopping at Air Miles Partners. While the general earn rate is a definite drop, the ability to earn 3x miles at Air Miles partners like Sobeys, Safeway, Staples, Shell, and the LCBO is a serious boost.
To make the comparison easier, we’ve broken down the values on a per-dollar basis, assuming you redeem for Cash Miles (95 miles = $10 / 1 mile = 10.5 cents in e-gift cards or discounts from Air Miles Partner stores).
|Now||After May 5|
|Air Miles Partner stores||1.05%||2.63%|
Another change is with the BMO Air Miles World Elite Mastercard’s interest rate. The APR is going to see a small bump from 19.99% to 20.99% (remember, interest won’t enter the equation as long as you pay off your balance in full each month. And frankly, if you do regularly carry a balance on your card, you should forgo rewards cards altogether and pick up a low interest card instead).
Lastly, unfortunately, the card’s airport lounge benefits will get a downgrade and no longer include two complimentary passes to Mastercard airport experiences. You will still have a membership and can access lounges, but it’ll cost you $32 USD per visit.
The bottom line
Following an unprecedented year that has deeply affected the travel industry and economy at large, changes to credit cards can be expected. If you carry these cards, what will you do? Will you stay loyal or search out a new card that better rewards your spending habits and needs?
Tip: If you’re currently a BMO cardholder and aren’t happy with the changes, you can consider contacting BMO and asking to switch to one of their other cards, including a no fee alternative. It’s a solution that can help you avoid paying the annual fee, while still retaining your credit limit and account history.