Changes to BMO World Elite Mastercard

Changes to the BMO World Elite Mastercard: Our Straightforward, Spin-Free Take

Last updated on May 31, 2018 Views: 7323 Comments: 2

After BMO announced changes to its World Elite Mastercard in November, GreedyRates readers have left comments of concern. Details released by BMO were initially vague, so many cardholders assumed the worst.

The formal changes have since been announced, and overall I feel that the BMO World Elite Mastercard is being devalued.

As is typical of corporate announcements, BMO has tried its best to put a positive spin on things and released the following updates to the card according to this page. (you can also skip below to read the GreedyRates version translated from PR speak into plain Canadian English.)

Original BMO announcement text

Earn BMO Rewards points 50% faster!

Get rewarded even sooner. Earn 3 BMO Rewards points for every $1.00 spent on eligible travel, dining and entertainment purchases, up to $50,000 in purchases per year.

Enjoy more rewards flexibility

We have reviewed the BMO Rewards program, and are making some changes to give you more choice and better value across our range of rewards:

  • Travel reward changes
    The number of BMO Rewards points needed to redeem for $1.00 in travel rewards will be increasing from 100 to 140 points. We understand that receiving full value for your travel rewards is important to you and we are committed to honouring the purchasing power of the BMO Rewards points you’ve already earned. As of January 15, 2018, we will be adding extra points to your BMO Rewards account to offset the impact of this change so you won’t lose the value of your points. This means there’s no rush to redeem your points now.
  • Improved value of merchandise and gift cards 
    BMO Rewards is not just about travel. As of January 15, 2018, you’ll be able to redeem for the same great merchandise and gift cards with up to 20% fewer points!
  • Invest more for your future with BMO financial contributions
    We have improved the value you receive when redeeming your points for eligible BMO investment accounts. You’ll be able to invest with 25% fewer points. It has never been more rewarding to invest in what matters to you most.
  • Coming February 2018! Turn your BMO Rewards points into cash
    For the ultimate in flexibility, treat yourself by purchasing whatever you want, wherever you want and use your BMO Rewards points to pay down your credit card balance. Get ready to pay yourself with points!

What this means

Until January 15th 2018, cardholders will continue to earn 2 BMO Rewards points for every $1 spent. For every $1 in travel credit you want to redeem, it costs 100 points. This essentially makes the existing deal a straight 2% return on all your purchases.

With the new features coming in, you’ll earn 3 BMO Rewards points for every $1 spent on travel, dining and entertainment purchases, while all other purchases will still get 2 points for every $1 spent. Sounds like an upgrade, right?

Except it’ll now cost you 140 BMO Rewards points for every $1 in travel credit you want to claim.

Some number crunching reveals that the overall return now works out to 2.14% on travel, dining and entertainment and 1.43% on everything else. Travel, dining and entertainment purchases now earn 7% more than they did, but all other categories earn 30% less. BMO isn’t wrong per se by stating you can earn points 50% faster, but they’ve neglected to note the second, less savory side of the math.

The upcoming cash back feature may appeal to cardholders that value flexibility, but the return on cash back is worse than rewards redemption for travel. For every 50 cents you want to claim toward your bill, it’ll cost you 140 points. That means your spending will only earn you a return of .72% – 1.05% when going the cash back route, which is clearly a bad deal whatever its flexibility.

The good news is, your current accumulated points won’t be downgraded. BMO will add 40% more points to your account to offset the changes, so you don’t lose any value there. That said, new applicants should pay close attention to the signup bonus if there are any further changes. Currently there is a bonus of 20,000 BMO Reward points, which has a value of $200. When the changes kick in, that bonus will be worth just under $143. Hopefully, BMO will increase the signup bonus, but since they haven’t said anything, I suspect that won’t be the case. GreedyRates will reach out to them for comment and report back.

Is the card still worth holding on to?

It’s understandable that a lot of cardholders are upset by what they see as a devaluation of their card, and are considering cancellation. But before you speed-dial customer service, it’s worth a reminder that the card still comes with some pretty impressive additional benefits.

  • Comprehensive travel insurance for 21 consecutive days
  • Flat fee, optional travel insurance for those between the ages of 65-74
  • Priority Pass membership with 4 annual airport lounge passes
  • No blackout dates and the ability to use points on taxes when claiming travel rewards
  • Purchase protection and extended warranty

The annual Priority Pass membership and lounge passes are worth about $200. And 21 days of travel insurance is quite long compared to other cards. The value of both those benefits may offset anything you’re losing in the new redemption changes, so hanging on to this card may still be worth it if you’re a frequent traveller. That said, every BMO World Elite cardholder should consider some alternative credit cards in the travel category, which might be of comparatively greater value after the BMO devaluation.

Other travel cards worth considering

American Express Cobalt – The new American Express Cobalt card gets you 5 points for every $1 spent at restaurants, bars, grocery stores and food delivery in Canada. An Amex Rewards point is worth about $0.01, so the return on those purchase categories is about 5%. Compare that to the BMO World Elite Mastercard’s return of 2.14% on travel, dining and entertainment.

You’re allowed to transfer your Amex Rewards points to Starwood Preferred Guest (SPG) at a 2:1 ratio, which means every $1 spent on eligible categories earns you 2.5 SPG points. And with SPG, you can transfer your points to 30+ airline loyalty programs at a 1:1 ratio. Plus for every 20,000 points you transfer to an airline partner, you get an additional 5,000 points, so your transfer ratio becomes 1:1.25. This is nothing to scoff at.

TD First Class Infinite Visa® – With the TD First Class Visa Infinite®, you earn 3 TD Points for every $1 spent. This works out to a flat return of 1.5% on all spend, which is similar to the BMO World Elite Mastercard. But there’s a simple way to increase your return with the TD First Class Visa Infinite®: if you book and redeem your points through Expedia for TD, your return becomes 4.5% (9 points for every $1 spent), which ends up being one of the highest returns for a travel credit card.

Scotiabank Gold American Express – The Scotiabank Gold American Express consistently ranks as one of the best travel rewards credit cards in the Canadian market, because you earn 4 Scotia Rewards points for every $1 spent on gas, groceries, restaurants, and entertainment. With those spend categories, you’re earning 4% back, since it takes 100 points to claim $1 in travel. There are no blackout dates at all, which gives you flexibility. You can choose to book your travel through Scotia Rewards’ full-service travel agency or on your own with points being redeemed later.

Article comments

Brian says:

I’ve got
Amex Platinum
Amex Gold
Amex Cobalt
BMO World Elite Mastercard
TD Aeroplan Visa Infinite
Which card would you recommend me using the most after introductory bonus for travel? I’m Canadian. Thx in advance.

GreedyRates says:

Hey Brian, that’s quite a diverse array of credit cards you’ve got there! It looks like you’ve gotten the most out of these cards’ introductory bonuses, and now you want to know which ones to keep and which to cancel. A big factor in your answer will be what you spend the most money on, and which type of rewards you prefer.

For example, you have the Amex Platinum and Amex Gold cards, which are mostly cards that earn points on travel and offer excellent travel rewards. The TD Aeroplan Visa Infinite card belongs in the same category, but it’ll probably be accepted at more merchants. In our opinion, you should cancel the Amex Gold card at least.

The Amex Cobalt and the BMO World Elite Mastercard are also somewhat similar, with rewards earned mostly from transportation, dining, and entertainment. However, the Amex card’s rewards are more flexible, so possibly consider cancelling the BMO card and keeping the Cobalt card to represent the only Amex in your wallet.

GreedyRates Staff