Credit Card reward points: How to earn and redeem reward points?

All credit cards come with reward points. Here’s how you avail them.

Credit card reward points are rewards or perks offered by banks to a credit card customer every time he or she spends on their credit card. These points add up automatically every time a transaction is made. Once you have collected a certain number of points, you can redeem them for several benefits which could be gift vouchers, merchandise, air milesairmiles or discounts on purchases. Credit card reward points are thus an incentive to credit card users to use their credit card more frequently for different transactions and get rewarded for it.

All credit cards will have a rewards program where you can find out how you earn reward points when you transact with your credit card. For example a credit card can offer you 3 reward points for every Rs 150 you spend. So if you spend Rs 60,000 on your credit card you end up earning 1,200 reward points. This can be redeemed for a voucher or merchandise or any other reward that the credit card offers.

 

How to earn reward points

You can earn reward points by making transactions on your credit card. Remember that there are various ways you can earn reward points from your credit card and that will depend on the type of credit card you have. You can maximise earning reward points on your credit card not just making more purchases through your credit card but also by using your credit card smartly. For that it is important to be aware of your credit card reward program and the various ways you can earn reward points.

Many credit cards will offer you reward points on joining. You can earn a few thousand reward points as soon as you get you get your credit card. You credit card issuer may also give you an option to earn more reward points by spending a certain amount on your card during a certain initial period.

Credit cards will offer you general reward points for every rupee spent and this is mostly valid on all types of transactions where you use your credit card. For example a credit card can offer you 1- 5 reward points for every Rs 150 spent. This could be if you use your credit card for swiping at merchant establishments, buying online, paying utility bills and so on. High end credit cards offer more reward points as the bank rewards customers who have been them for a while and who spend big on their credit card.

Credit cards will also offer special reward points or accelerated reward points depending on the type of credit card. Some cards will offer you 10X reward points on select partner brands.  If you are getting 4 reward points for spending Rs 150 normally, you can earn 40 reward points if you use your credit card to shop with a partner brand.  Or you may earn 10X reward points for shopping internationally, buying tickets from a certain airline as the case may be. Fuel credit cards will offer you more points if you swipe your credit card to purchase fuel at partner outlets, travel credit cards will offer you accelerated reward points for making travel purchases and so on.

There are various ways you can use your credit card to earn reward points. You can use your credit card for everyday transactions whether it is online shopping, grocery shopping, eating out or buying petrol.

If you use your credit card to make high value purchases like buying electronic items, jewellery or for booking holidays, you can earn credit card reward points faster.

Another way is to link your utility bill payments to your credit card. These are mandatory expenses you have to make every month and you can earn rewards on them. You may also be eligible to win loyalty points if you renew your credit card every year.

Apart from the above reward points, credit card issuers also offer you bonus reward points if you make spends above a certain amount in a month. For example you may be entitled to 2 reward points every Rs 150 spent but that may double if you spend more than Rs 1.5 lakh a month.  This is again an incentive by the bank so that you spend more on your credit card.

 

How to redeem reward points

Once you have earned a minimum number of reward points you can choose to redeem them. You can find out your reward points balance by logging in your credit card account or by calling up customer care of your bank.

How you will redeem your reward points will depend on what you want to redeem the reward points for.

If you want to redeem your reward points for any merchandise or gift vouchers you have to view the rewards catalogue to find out what are the options available and how much reward points each of them cost.

Let us say that an online shopping portal is offering you gift vouchers of Rs 500 by redeeming 1,500 reward points. If your reward point balance is over 7,500 you can redeem them to avail 5 such vouchers. You can then use those voucher to make a purchase a product of Rs 2,500 from the online portal. For redeeming offline vouchers you would need to visit a store.

If you are redeeming your reward points for any product from the reward catalogue the process is similar. Choose the product you want and if your card account has enough reward points you can select the product and redeem your reward points. The product is shipped to your mailing address.

If you wish to redeem your reward points to buy a flight ticket, you have the option of visiting the bank’s website and paying for a flight ticket directly through your reward points. If your reward points are not enough you may be asked to pay the rest separately. Similarly if you are using a fuel credit card you will be able to redeem reward points for fuel.

 

Modes of reward redemption

Credit card companies offer their customers various modes of redemption for the rewards. We take a look at the various ways one can redeem credit card reward points.

Online redemption: This is the easiest and the most convenient way to redeem your reward points. For this you need to be registered with your bank for online banking. Here are the steps for online redemption of credit card reward points.

1. Login to netbanking
2. Register your credit card
3. Once registered, click on the ‘reward points’ link in the credit card section.
4. View the rewards catalogue and choose the vouchers you want or the items you want to buy by using your reward points.
5. Redeem the credit card points you have to get these vouchers or merchandise
6. In case you choose to redeem your points for vouchers, they are mailed to you. If you are redeeming your reward points for any merchandise, it will be delivered to your registered postal address in 7-10 business working days.

By calling up customer care: You can also get in touch with the customer care of your bank to redeem your reward points. The customer care executive will explain to you how many reward points you have and also your options for points redemption. You can place your redemption request with the customer care executive by selecting the product or the gift voucher of your choice. The voucher would be mailed to you. In case of any merchandise it will be delivered to you by post.

By post: You can also redeem your reward points through post and this is the process that takes the most time. For that you have to download the redemption form from the bank’s website. There you would need to fill in details like the product code, product name, quantity and also other details like your name, card number and so on. Then you need to mail the filled up the filled up redemption form to the bank and they will take up the redemption process.

 

Credit card rewards catalogue

As seen above, one of the ways to redeem reward points is to choose from a wide range of products and gift vouchers across a lot of categories like electronics, apparel, travel, dining and more.

To know about the brands and the gift vouchers available for redemption one needs to visit the credit card rewards catalogue which is available on the website of the credit card issuer.

The reward points catalogue will have information on partner brands and how many reward points one needs to redeem to get vouchers of that brand which may be worth Rs 500, Rs 1,000 and so on. It will also have information on reward points that need to be redeemed for the different merchandise listed.

 

FAQs

How do I earn more reward points on my credit card?

Credit card reward points are designed in such a way that you earn more reward points the more you spend on your credit card. Using your credit card for everyday transactions, grocery shopping and paying for utility bills will help you earn reward points. You should also study your credit card reward program to know how you can earn accelerated reward points on your credit card. For example using your credit card to make purchases from partner brands will help you earn more reward points on your credit card.

How do I check how many reward points I have earned?

Checking how many reward points you have earned is easy. You can log into netbanking. If your card is registered, you can check the number of reward points your card has by going to the credit card rewards section. The other way to find out how many credit card reward points you have is to call up the customer care of your bank.

When can I start redeeming reward points?

Normally you would need a minimum number of reward points before you can redeem it. The minimum number of points required is 500. Of course it will also depend on what you want to redeem your points for.

What are the charges I pay for redeeming reward points on my credit card?

Banks charge you a certain amount to redeem reward points, which mostly is Rs 99. This is fact the processing fee for your reward points redemption request. This charge is sometimes also known as the reward redemption handling fee.

How long does it take to redeem reward points?  

If you redeem your reward points for a product from the product catalogue it will take up to 10 days for the product to be delivered to your registered address. However, if you are redeeming your reward points for vouchers they will be emailed to you instantly. You would have to visit the merchant store to redeem those reward points or you may also redeem them when shopping online.  Remember that gift vouchers can only be redeemed at select merchant stores which is mentioned on the voucher itself or on the rewards catalogue.

How long are the gift vouchers I redeem valid?

The gift vouchers you redeem will be valid for a certain period. The validity will be mentioned on the gift voucher. Remember to redeem the vouchers by their validity date.

What should I do if I face any difficulty to redeem my reward points online?

If you are facing any difficulty to redeem your reward points online, you may call up the customer care of the bank. You may also send a mail with your query at the registered email address of the bank. 

Do the reward points I earn on my cards expire?

This will depend on your credit card. For some banks the reward points may expire 2 years from the date of generation. In other cases the reward points do not expire. Call up your bank’s customer care to know the validity of your reward points. However remember that reward points cannot be redeemed if your credit card account is closed.