BMO World Elite Mastercard changes confirmed for January 15, 2018

On November 13 we detailed that negative changes were coming to several BMO credit cards and thanks to all our readers we know most if not all of the details that were happening. This post looks at the very popular BMO Rewards World Elite Mastercard that up until several years ago was our Top Travel Points Credit Card with an annual fee but that changed as they made the card less attractive and now it is becoming even more so. As we see in a lot of cases the company tries to put a positive spin on the changes but when you delve deep and look at all the numbers we typically find the changes to be negative.

According to this page on the BMO site here is what is happening to the BMO Rewards World Elite Mastercard:

Earn BMO Rewards points 50% faster!

Get rewarded even sooner. Earn 3 BMO Rewards points for every $1.00 spent on eligible travel, dining and entertainment purchases, up to $50,000 in purchases per year.1, 2

Enjoy more rewards flexibility

have reviewed the BMO Rewards program, and are making some changes to
give you more choice and better value across our range of rewards:

  • Travel reward changes
    The number of BMO Rewards points needed to redeem3 for $1.00 in travel rewards will be increasing from 100 to 140 points. We understand that receiving full value for your travel rewards is important to you and we
    are committed to honouring the purchasing power of the BMO Rewards
    points you’ve already earned. As of January 15, 2018, we will be adding
    extra points to your BMO Rewards account to offset the impact of this
    change so you won’t lose the value of your points.
    This means there’s no rush to redeem your points now.
  • Improved value of merchandise and gift cards
    Rewards is not just about travel. As of January 15, 2018, you’ll be
    able to redeem for the same great merchandise and gift cards with up to 20% fewer points!
  • Invest more for your future with BMO financial contributions
    have improved the value you receive when redeeming your points for
    eligible BMO investment accounts. You’ll be able to invest with 25% fewer points. It has never been more rewarding to invest in what matters to you most.
  • Coming February 2018! Turn your BMO Rewards points into cash
    the ultimate in flexibility, treat yourself by purchasing whatever you
    want, wherever you want and use your BMO Rewards points to pay down your
    credit card balance. Get ready to pay yourself with points!

First off they tell you you can earn points 50% faster – but that’s only in three categories. Multiplier bonuses are always great but when you change other aspects of the program it can kill those multiplier bonuses. Not to mention, multipliers while we love them can make a nice and simple program like the BMO Rewards one more complicated (which it gets even more complicated now that redemption is changing as well). So come January 15th the card will continue to earn 2 points per dollar spent on all purchases outside of travel, dining and entertainment which will earn 3 points per dollar. In the old program it was a simple 2 points per dollar on all purchases.

Now to the second change, the change in redemption rate. Before it was 100 points for a $1 travel credit which meant your 2 points per dollar equated to a straight 2% return. Now the redemption rate will be 140 points for $1 come January 15. That means you’ll have a varying return depending on your spending. For your 3 points per dollar spending your return equates to a 2.14% return and your 2 points per dollar now equate to a 1.43% return. As you can see most spending categories on this card will now be worth nearly 30% less while the three categories that get boosted only see a 7% increase. Not ideal. Now this card will really only make sense for purchases in the three boosted categories outside of that there are cards with much better returns. And we aren’t even diving into the card costing $150 per year plus $50 for supplementary cards. Close competitors are cheaper on that front but yes with the BMO Card you get your Priority Pass membership covered with the card along with 4 free lounge visits, something you will have to take into account. For those who have the card already you won’t lose the value of your earned points up to January 15 as they will add extra points to your account to account for the change to 140 from 100.

The other change of note will be the ability to use points to pay down your balance, essentially a cash back option. The site doesn’t state what the rate is but according to some forums it is half the travel rate. So 140 points will be worth 50 cents. This is following in the footsteps of several other programs that now have cash back options with their cards on top of the better travel redemption options. This means you are looking at a .72 to 1.05% return for the cash back option.

Overall I’m really torn by this card – it still has hints of greatness, the lounge access can be worth the annual fee, it has a really good insurance package attached to it and the 2.14% for travel if you only use the card at category bonus merchants is pretty good. However the high cost of ownership of the card, the much lower return on non-category bonus spending and the fact that you have to redeem your points for travel via BMO Rewards to achieve the best return are real downfalls of this card. Its closest competitors allow you to book any travel you want with lowering the value of your points and give you up to 12 months after the travel is charged to redeem your points for it giving you more flexibility – this card does not.

What do you all think? Am I being too hard on the card or do you agree that in general it keeps going on a downward spiral? Let me know in the comments section below.