RBC Devaluing Conversion to American Airlines AAdvantage
One of my readers email me a few days ago about this, I was in denial for a few days. But it is true. If you log into your RBC Rewards account, you will find the following wording:
- Please be advised of the upcoming changes to the conversion of RBC Rewards points to American Airlines AAdvantage miles through the RBC Rewards program. Effective May 2, 2017, for every 10 RBC Rewards points which is converted, you will receive 7 AAdvantage miles. A maximum of 500,000 points may be converted annually. A minimum conversion of 5,000 points continues to apply each time.
Normally, you can convert at a 1:1 ratio, with a minimum of 5,000 RBC Rewards points to American Airlines. It now drops to a 10:7 ratio, which is a 30% decrease. Imagine cutting your salaries by 30%. How would you feel about that? So much for waiting for a transfer bonus, they are going backwards instead. They also implementing an annual maximum as well. Which is pretty unnecessary because it will no longer valuable to transfer to AAdvantage anyway.
I do not have much more to say about this, because this stings too much (especially because RBC Rewards is one of my favourite rewards program). I just transferred my remaining RBC Reward points to American Airlines.
You may not have noticed but the C$ vs the U$ has devalued by close to 30% in the past couple of years. Since RBC must buy AA miles in U$s, and most cards do provide a ratio of conversion accordingly, this should come as no surprise. BMO’s Diners conversion has always been about 20% or so less than the actual points redeemed for airline miles and hotel points..
So if that is the logic, if the Canadian dollar goes up, will they reverse it back? All good, I understand, it doesn’t make it less frustrating to see.
Yeah everybody knows that’s not gonna happen (reversing the transfer ratio if the Canadian dollar goes up)! 🙁
Have you heard anything about the conversion ratio from RBC to other programs such as British Airways?
Also, is there a big difference between using AAdvantage to book American Airlines flights and using British Airways’ program to book American Airlines flights? Does it require less miles or are the fees less expensive?
AA has a fixed award chart, while British Airways charges miles based on distance. So in theory, it’s typically cheaper to use British Airways on short-haul flights with One World Alliance and better to use AA on longer routes. British Airways charges hefty fuel surcharges on their own flights, so I would typically stay away from them.
Thanks for chiming in!
Thanks for sharing this information! I’m not familiar with either AA or BA’s programs but was interested in getting some pointers on these programs since I’m often frustrated with Aeroplan.
You are very welcome!
Good point.
It may not be as easy to find AA award availability with BA as you would with AA, even though they are both Oneworld members.
Yeah if the CAD $ goes back up, no way they are gonna reverse the rate. It would be like airlines not charging for checked bags again. Once they get that money, too difficult to give up.
At least they gave notice and we definitely be transferring all my miles to AA for our trip to the Maldives/Dubai in 2019 and for use in Etihad’s Residence from ABU to JFK.
Agreed. Good analogy!
so is this card only good for BA Avios now? my main reason to have it was for the AA earning. it was essentially like having an AA card. maybe i should look at cancelling and moving to Mariott Rewards Visa. Thoughts?
You can always go the fixed rewards route, as well as Asia Miles.
After the Brexit vote the Canadain $ gained 20% on the British pound but RBC did not offer more points per transfer to BA. This is a one way street to suit the bank not the consumer.
If it is profitable, there is no reason to do anything in favor of clients. When they are losing money, they have to pull back.
But at the end of the day, I still think it comes down to lack of competition. If the competition was there, they would compete for our business, rather than squeeze us!
Canadian banks have unfortunately started this race to the bottom when it comes to credit card rewards or simply eliminating them. MBNA (TD), Tangerine (Scotia), Chase and now RBC. Whereas in the U.S. competition is alive and well, and rewarding. But no our government Competition Bureau sees that it’s a very healthy sector (i.e. quasi-monopoly they like to protect).
Canadian banks are making the government so much money with all the taxes that they bring in, so it is very difficult for the government to push the banks around.
Note- this is Effective May 2, 2017, so you still have time
Yes! Just under a month to go.
OMG this is horrible news.
Earning AA miles at 1 mile per dollar ratio was the only reason I had this card.
going from 10:10 to 10:7 is just ridiculous.
I am not going to give RBC any of my spendings anymore.
Yes, it is unfortunate to see.
Yepp me neither…..as you reading this I’m dumping my RBC Visa for a new TD Aeroplan Infinity….Had enough of this BS by RBC Avion…
Never be shy to give your business to someone else who you feel deserves it!
Hey Matthew….thanks for the heads up, but do you still think converting them into AA is the right thing to do? AA miles are slowly becoming useless as availability is abysmal……..I currently have 200k AA miles and 250k RBC points, so I dont know what I would do with 450k AA miles….but then again, what else would I do with my RBC points unless I wait for another 50% BA transfer bonus.
There is never a right or wrong answer. It matters more what your personal goals are. If you can get your trip funded by miles and points at a value that you are fine with, then I would say you came out ahead compared to paying your trip with your hard earned cash.
In your case, I would only transfer if you had a specific goal in mind with AA. Otherwise, waiting for a BA transfer bonus may make more sense.
I’m not sure what all the fuss is about. Does this affect transfers of RBC points to BA Avios as well? BA has for years (except for a short period) offered a transfer bonus of 1.5:1 into the BA Avios program twice each year. Point is if you flew with AA, you were better off using Avios points to book the AA flight despite the long haul vs short points differences between programs – because the transfer bonus ultimately meant less RBC points were needed.
That said, AA is about the last place I’d points right now. Take a good hard look at what you can redeem those AA points on. SSAver rewards are becoming almost non-existant. It’s like a ponzi scheme – you put money in but there’s no way for you to get it out since seats are not being made available. Sure, you can redeem AA points for AAnytime rewards which are easier to find.. but at double the number of points.. I’d bet in most cases if you check the cost of the flight itself, you could buy it with RBC points for less than points that were converted to AA… Quite pathetic really.
I think a big part of it is personal preference. Historically I have mostly transferred to BA during the bonus transfers. However, I also like diversifying my portfolio.
That being said, the main point is that it is unfortunately to see a devaluation as it can lead to more. Rather than seeing an upgrade in the program.
Agreed!
I disagree with MoneySimple completely.
Most people who hold this card would not be holding it for it’s potential to earn AA rewards. Devaluation of RBC points to AA points is not not even the biggest issue, this is: http://onemileatatime.boardingarea.com/2017/04/28/no-american-award-seats/
And despite the above, I would still choose the RBC points over the free year. SIt’s simple money… 15k points = $150 even if you don’t know how to maximize value of the points. This is better than the $120/year fee. If you know how to maximize the value, the points are worth substantially more.
how long to transfers from RBC to aa take?
Took about a week for me.
Just found out about this today when I tried to transfer, very upset. I have been transferring to AA Miles for years, this will be the end of my RBC credit card use. Total ripoff, since RBC is not paying for any of these miles anyway, it is the merchants who process the cards that pay for all points programs, not the banks.
Time to cut up the RBC Avion card, it is now one of the worst points cards out there from my perspective.
Yes. Definitely quite an unfortunate turn of events. The currency exchange rates really took a tool.