Looks like it’s a season of devaluation and after Yes Bank and HDFC reduced reward rate on their credit cards, IndusInd followed their path to reduce reward rate on their credit cards. IndusInd announced couple of changes to their reward structure which impacts the reward rate on certain categories and maximum cap on reward rate. These changes will go in effect from 1 August 2019 and will render IndusInd credit even more unattractive.
Reduced rewards on select categories
IndusInd Bank has reduced reward rate to 0.7% on following select categories:
- Utility Bill Payments
- Insurance Premium Payments
- Government Services/Charges/Payments
- Education Institute Fees
Earlier card holders used to earn 2-2.5% on these categories and reduction to 0.7% is a sharp reduction. Good thing is reward rate on other categories remains intact for now.
Rewards capped to credit limit
Card holders will earn rewards points on spends made only till their credit limit in a statement cycle. If you have a low credit limit and you spend by pre-paying the amount within the statement cycle, you will not earn rewards on amount exceeding your credit limit. This is the most unnecessary and useless restriction in my opinion.
The detailed terms and conditions for this revision in reward program can be found on IndusInd Bank website.
The sharp reduction on reward rate for the four aforementioned categories is huge blow to IndusInd credit card holders. Instead of reducing reward rate, they should have capped the maximum number of rewards on those categories per statement cycle which would have been more sensible. Also IndusInd is already capping maximum reward points you can earn in a statement cycle, and now restriction to earn rewards only till credit limit renders their credit cards even more unattractive.
Let me know your views on this revision in reward rate by IndusInd Bank in comments below.