EXCLUSIVE: No more pro-rata fee refunds for UK American Express cardholders

American Express has traditionally offered one feature which other UK credit card companies did not.

If you took out a card with an upfront annual fee, you would receive a pro-rata fee refund if you cancelled your card part-way through the year.

This is now ending for most cards.

It isn’t ending today. The change will take place on 2nd October 2023.

From that date, you will no longer receive a pro-rata fee refund after cancelling certain American Express cards. You will still be allowed to cancel your card but you won’t get any portion of the annual fee back.

Anyone who took out a card before 31st May 2023 will receive formal notification of the changes in the next few weeks.

Anyone who took out a card from 1st June 2023 will not receive any notification, because the option to receive a pro-rata refund was quietly removed from the T&C for new applicants on that date. However, you are still allowed to request a pro-rata refund before 2nd October 2023.

Does this change apply to all American Express cards?

No.

The change only impacts credit cards.

If you still hold a charge card – although all personal charge cards have been withdrawn from the market over the last couple of years for new applicants – then nothing changes. You will still be able to cancel it at any point for a pro-rata fee refund.

What happens if American Express cancels your card?

You will still receive a pro-rata fee refund if your card is cancelled by American Express for any reason.

How will this change the card market?

That’s a good question, especially as you also need to factor in the appeal of competing products – the Barclaycard Avios Plus Mastercard, for example, has a fee of £20 per month and so can be cancelled at any time without penalty.

Let’s look at a few of the cards:

American Express Preferred Rewards Gold

American Express Preferred Rewards Gold is free for the first year, so the appeal of this card (you currently receive an increased 25,000 Membership Rewards points bonus, £120 of Deliveroo credit, four airport lounge passes) is unchanged.

The Platinum Card from American Express

The Platinum Card is more complex, but at a non-refundable £575 for the first year it remains a good proposition (30,000 Membership Rewards points bonus, £300 of dining credit, £100 of Harvey Nichols credit, two Priority Passes, travel insurance etc).

During special offers such as the recent ‘60,000 points + £200 of Amex Travel credit’ promotion it becomes exceptional value for the first year, even at the full £575.

British Airways Premium Plus American Express

The British Airways Premium Plus card becomes less attractive for a quick pump and dump, with the 25,000 Avios bonus equalling but not exceeding the £250 annual fee on our valuation.

However, because of the value of the annual 2-4-1 companion voucher, it is by far the most common card for HfP readers to keep for the long term. I doubt many people who read HfP cancel this card quickly.

Marriott Bonvoy American Express

Most HfP readers who have the Marriott Bonvoy American Express card will have it because of the 15 free elite night credits you receive. This is an annual benefit, and anyone who gets the card purely for the elite nights is probably in it for the long haul.

The 15 elite nights even count towards lifetime status.

Conclusion

My gut feeling is that American Express will see an improvement in the ‘quality’ of cardholders who sign up for The Platinum Card and – for non-HfP readers who don’t understand the value of the 2-4-1 voucher – the British Airways Premium Plus American Express card.

The acceptance criteria for The Platinum Card has already been quietly tightened up this year to improve ‘quality’ but this move goes further.

It remains to be seen if blocking British Airways Premium Plus refunds will make the Barclaycard Avios Plus Mastercard more attractive for people looking for their first Avios credit card.

These changes probably won’t make much difference during special promotions. The offer of 70,000 Avios for getting the British Airways Premium Plus American Express card which ran earlier this year remains astonishing value even when you are locked in to a £250 first year fee. The same goes for the ‘60,000 Membership Rewards points + £200’ offer which recently ran on The Platinum Card.

What interests me is whether some people will still choose to cancel their cards quickly even when they don’t get a fee refund. This would make sense in some scenarios, since the quicker you cancel, the quicker the two year clock for reapplying comes around.

There is some upside too. It is possible that American Express will increase sign-up bonuses further on its paid cards because it knows that cardholders are committed to a full year.

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Want to earn more points from credit cards? – April 2025 update

If you are looking to apply for a new credit card, here are our top recommendations based on the current sign-up bonuses.

In 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.

You qualify for the bonus on these cards even if you have a British Airways American Express card:

You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.

SPECIAL OFFER: Until 27th May 2025, the sign-up bonus on the ‘free for a year’ American Express Preferred Rewards Gold card is increased from 20,000 Membership Rewards points to 30,000 points. Points convert 1:1 into Avios (30,000 Avios!) and many other programmes. Some people may see even higher personalised offers. Click here to apply.

SPECIAL OFFER: Until 27th May 2025, the sign-up bonus on American Express Platinum is increased from 50,000 Membership Rewards points to a huge 80,000 points. Points convert 1:1 into Avios (80,000 Avios!) and many other programmes. Some people may see even higher personalised offers. Click here to apply.

Earning miles and points from small business cards

If you are a sole trader or run a small company, you may also want to check out these offers: