Table of Contents
Introduction
If you have ever used a credit card, you know how fruitful the credit card rewards can be. These are the alluring perks in the form of cashback, discounts, and exclusive services that you can use during your travel or everyday spending.
It can drastically reduce overall expenses for you or give you access to exclusive deals that only cardholders can enjoy. All in all, rewards are one of the best parts about credit cards!
Now, the question that cardholders commonly ask is, can I sell my credit card rewards? If you also have a similar query, you have landed in the right place. In this article, we will discuss everything about credit card rewards, the legal terms involved in selling them, and how exactly you can do it.
Understanding Credit Card Rewards
Credit card rewards are the additional perks you get for using the card. It is like a discount or compensation you get against every transaction you make through the card. These rewards typically fall under three categories, explained below.
| Travel Rewards | Cash-back Rewards | Point Rewards |
| You can redeem these rewards while making flight or hotel bookings. Travel credit cards give you price discounts, upgrades, or lounge access. | You get some percentage of your card spending back into your account in the cashback reward category. This amount is then available for you to use for your next purchase. | Every time you spend through your card, you earn store points. When you keep accumulating these points, you can redeem them on your next purchase and get monetary discounts. |
Is Selling Credit Card Rewards Legal?
Coming to the question, is it legal to sell credit card rewards? Well, the straight answer is NO. The terms and conditions that the card issuing body sets are majorly against selling credit card rewards. These rewards are non-transferable and are supposed to be used by only the cardholder or the primary card user.
Understand the whole point of rewards is that you enjoy using your card and get privileges that are available to no one else but you. If you sell those rewards, the whole idea sounds lame. Some banks, like American Express, have even set strict penalties for violating terms, which can be anything from account suspension to cancellation of all rewards forever.
Apart from policies set by the card issuer, selling your credit card rewards can also make you fall prey to fraud. There are third-party applications where you can sell your rewards or perks, but these are not officially recognized by either the bank or the government. It means you are at a higher risk of getting scammed! The buyers can refuse to pay, or there can be other monetary losses.
If you don’t have a rewards credit card then we have articles for you to find the best rewards credit card for you.
How Do People Sell Credit Card Rewards?
Despite the fact that it is against the legal terms to sell credit card rewards, people still have direct or indirect ways to sell them. These are informal sales that don’t happen through a lethal platform, and there are risks involved. Some of the ways are discussed below:
Sell to Friends/Family
One of the simple ways is to sell the rewards within your network. Share details with your friends or family and let them enjoy the perks that were exclusively meant for you. It is a safe way to use your rewards to earn some cash.
Online Marketplaces
Another way is to use marketplaces or online forums where random strangers are generally looking for people who are interested in selling rewards. We highly condemn this mode of selling owing to the high level of risk involved. You have no idea about the buyer, and it can result in a messy fraud.
Third-Party Brokers
You can also find third-party brokers on legally recognized websites, like points.com. Though this website is legal, it doesn’t directly involve or take responsibility for selling reward points through it. On these platforms, you have to make an indirect sale. Firstly, you will convert the rewards into a gift card and then exchange it at a higher value.
It is significant to note that none of these methods is recommended, and it is highly advisable to not be involved in selling credit card rewards to save yourself from potential fraud.
Risks and Downsides of Selling Rewards
If you decide to sell your credit card rewards anyhow, it is crucial that you are aware of all the risks and downsides involved. The severity of the chaos will help you figure out whether it is worth taking the risk or not.
Account Suspension or Closure
Your credit card issuers closely watch every activity happening through the card. If they monitor any suspicious or unusual activity, it can lead to permanent account termination. Some banks have strict policies against such violations, and you may even get blacklisted and never get a credit card again.
Scams & Frauds
Another downside is that you can fall prey to fraud or scams. There are credit card scams that may lead to unauthorized spending through your card. Furthermore, you may get caught in a buyer racket that refuses to pay after using your rewards.
Legal Repercussions
Though it is a rare scenario that your card issuer takes legal action, chances are there. Some financial institutes are strict against policy violation, and if the actions have harmed the program in any manner, you may have to face legal repercussions.
Point Devaluation
Some third-party platforms where you try to sell the rewards can also devalue the perks. So, if your purpose is to gain monetary profit, it might not be a fruitful deal. It is rather financially beneficial to use those points personally.
Losing accumulated rewards
Lastly, you can lose all your accumulated rewards if you try to make a deal and the card issuer finds it out. All your points will drop down to zero, and you will have to start from scratch.
You can face one or more of these situations while selling your credit card rewards. It can get severely chaotic, leaving you with regrets.
Alternatives to Selling Credit Card Rewards
If you wish to use your credit card rewards to the fullest but hesitate to sell due to the risks involved, we are here to help. Let us discuss the ways you can make the most of your reward points without getting into illegal and unauthorized selling.
Redeeming for Travel or Gift Cards:
You should use your rewards for a unique travel experience, booking luxury stays and flight tickets. Furthermore, you can use the points to get gift cards, which can be an excellent gift of choice for friends and family.
Shop with Points:
Every time you go to buy your daily commodities, make sure you visit stores associated with your card. You can use the points on the merchandise stores and enjoy a discounted shopping experience.
Transferring Points: Some card issuers allow users to transfer reward points within the network but not in exchange for money! You can exchange points between the same credit cards and use them for an excellent buying experience.
Charitable Donations: Another way is to support a social cause and use your reward points to make donations. Some financial institutes allow charitable donations through credit card rewards; you can check these details before signing up.
Maximizing the Value of Your Credit Card Rewards
If your primary purpose of selling the rewards is to maximize the value, here are a few ways you can consider for the same instead of selling.
| Redeem for High-Value Purchases | Sell Merchandise Purchases | Combine with Loyalty Programs |
| Use your reward points for high-value travel experiences. It is beneficial for travel points or miles-related rewards, as they often outsize their value when you book first-class tickets or luxury resorts through them. | Another way to maximize the value is to combine multiple loyalty programs that complement each other. For example, you should use your airline credit card with a general travel card to earn points and miles both with your booking. | Another way to maximize the value is to combine multiple loyalty programs that complement each other. For example, you should use your airline credit card with a general travel card to earn points and miles both with your booking. |
Final Thoughts: Is It Worth It?
While it might seem tempting, it is not worth taking the risks and selling your credit card rewards. You may find a source for selling, but the repercussions or downsides involved outweigh that profit and put you in a chaotic situation. Moreover, the value you receive after selling is often lower than the potential worth of the rewards if you use them for yourself.
Hence, rather than selling the rewards, you can consider a safer approach and plan a strategic redemption. Try maximizing the value of your rewards and making the most of them by keeping them in your closed circle and not using them for commercial selling. Plan the use of your credit cards and reward redemption, and you can enjoy a fruitful shopping experience.
