[AMEX Updates Card Closure Language For New York Card Members] New York’s Credit Card Points Protection Law Now In Effect, Will It Be A Game-Changer Or Nothingburger?

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Update: AMEX now notes when closing a card that having a New York billing address on any card that shares that same Membership Rewards account means you can continue to redeem points for 90 days after card closure:

Originally posted on 12/10/23:

New York’s credit card points protection law goes into effect today.

You can read the details of Section 520-E here.

In short, banks will have to notify cardholders when a card’s rewards program is being devalued or closed, at least 45 days ahead of the change. From the day of the notice, consumers will have a 90 day grace period to redeem points under the original program terms.

If you close your account or a bank closes your account, you will have 90 days to redeem your points, which is more generous than most banks currently provide.

However, banks are allowed to close your account and remove points when there is fraud or misuse. That’s a huge loophole for banks, as they can claim misuse whenever an account is closed.

Currently, banks don’t need to explain what that misuse is, but perhaps under this law that will have to be disclosed to the state?

It’s worth noting that the law states that this applies to any “denominated units that can be accumulated in an account in connection with a credit card reward, loyalty, or other incentive program, often referred to as points or for certain travel-related rewards as miles, which are redeemable, fungible, or otherwise exchangeable, in whole or in part, for rewards.”

Does that mean it applies to miles with airlines and hotels in addition to banks? Can NY even regulate airline programs like that?

The law doesn’t specify what penalties or recourse will apply to companies that violate the new law.

Will banks change the rules just for New Yorkers, or will they make changes across the board?

There appear to be more questions than answers, so we’ll have to wait and see how banks or even airlines react to this new law, but New Yorkers can file complaints to the state’s consumer protection department here. If you do file a complaint, let us know how the state responds!