RBS dumps YourPoints credit card reward scheme

Bank blames incoming credit card fee cap

Updated: 
RBS dumps YourPoints credit card reward scheme

Royal Bank of Scotland (RBS) has announced that it is to scrap its YourPoints credit card reward scheme.

RBS blamed the European Parliament's decision to cap interchange fees, the same reason given by Capital One last week when it dropped its own cashback credit cards.

The YourPoints scheme allows you to earn one point for every £1 you spend on your credit card, which can then be cashed in for money off vouchers at places like Amazon, Boots and Harvey Nichols.

The banking group said the rewards scheme is being closed on 1st July to both RBS and NatWest customers, but it will be writing to affected customers from the end of April. The letters will explain how many points you have, what they are worth if you redeem them in rewards and what they are worth if you take them in cash.

A spokesperson said: "These regulatory changes would have an impact on our ability to recoup the costs of running multiple schemes, and so we are simplifying to focus on one reward scheme – Cashback Plus."

Cashback Plus is a cashback scheme available on credit and debit cards from the bank. For example, with the RBS Cashback Plus credit card you earn at least 1% cashback at partner retailers, 1% cashback at all supermarkets and 0.5% everywhere else. Until 30th June you get a bonus 1% cashback if you pay by contactless, while you can pocket a whopping 10% cashback on money spent in restaurants and bars.

The problem with interchange fees

Interchange fees are charges paid by retailers to card issuers when a debit or credit card is used. With credit cards, they tend to cost around 0.8%, but new regulations coming into force this year will cap them at 0.3%.

As a result, Capital One and RBS have moved to scale back their reward schemes, arguing that they are not sustainable. We will have to wait and see whether other providers follow suit.

However, it's worth noting that for the first three years the cap will not apply to American Express-issued cards, so they should be safe for a while yet.

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