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Mint
4 days ago
- Business
- Mint
What is a credit card upgrade offer, and should you consider it?
When an individual starts their credit card journey, their first card is usually an entry-level card with basic features and benefits. With time, as the individual progresses through the credit card journey, they realise that they need a higher variant credit card with better features and benefits from the same bank. They can do that when the bank sends an upgrade offer or the customer asks the bank for a credit card upgrade. In this article, we will understand what a credit card upgrade is, its benefits, how to become eligible for it, and should an individual opt for it. A credit card upgrade is the process of transitioning from an existing card to a higher variant card with better features and benefits from the same bank. For example, suppose an individual holds an HDFC Bank Regalia Gold Credit Card. If the bank sends a request to the individual for the HDFC Bank Diners Club Black Credit Card, it is a credit card upgrade. Similarly, suppose an individual holds an American Express Membership Reward Credit Card (MRCC). If the individual gets a request for the Platinum Travel Credit Card, it is a credit card upgrade. If the individual accepts the credit card upgrade offer, the bank will send the new credit card. Once the individual activates the new credit card and starts using it, the existing credit card will be disabled. The upgraded credit card usually comes with better features and benefits. Some of these include the following. Higher credit limit: Usually, the upgraded credit card comes with a higher credit limit. When an individual gets a higher credit limit and their monthly expenses using the card remain the same, the credit utilisation ratio (CUR) goes down. The credit utilisation ratio (CUR) measures the percentage of credit limit used from the total credit limit available. A CUR of 30% or lower contributes towards improving the credit score. Higher rewards: The upgraded credit card usually comes with better features and benefits including reward points. For example, the HDFC Bank Diners Club Black Credit Card provides 3X reward points for the purchase of instant vouchers of various brands through the SmartBuy portal. If the cardholder gets upgraded to HDFC Bank Infinia Credit Card, they will get 5X reward points for the purchase of instant vouchers through the SmartBuy portal. Similarly, an American Express Membership Rewards Credit Card (MRCC) provides 2X reward points for the purchase of instant vouchers of various brands through the Rewards Multiplier platform. If the cardholder gets upgraded to American Express Platinum Travel Credit Card, they will get 3X reward points for the purchase of instant vouchers through the Rewards Multiplier platform. Banks keep monitoring the usage pattern of the existing card and other factors regularly and send card upgrades to cardholders from time to time. Some of these factors include the following. Spends on the existing card: The spends done through the existing credit card is one of the most important factors for a credit card upgrade offer. If the cardholder spends a specified amount within a specified time using the existing card, they may become eligible for an upgrade, provided other eligibility criteria are also met. Hence, you may put most of your regular spends on the credit card of the bank from whom you are looking for a credit card upgrade. In the last few months, if you have spent a decent amount using the card, and have still not received a card upgrade offer, you may contact the bank and request for a card upgrade offer. If your salary has increased recently, and the monthly income meets the eligibility criteria of the credit card you want, you may contact the bank. Share your updated income details and request the bank for a credit card upgrade offer. Timely payments: Irrespective of whether you are looking for a credit card upgrade offer or not, you must pay the credit card monthly bill before or by the due date. Banks usually give preference to cardholders who make timely payments for credit card upgrade offers, provided other eligibility criteria are met. Long-term relationship with the bank: If you have a long-standing relationship and a good net relationship value (NRV) with the bank, they may offer you a credit card upgrade. If you don't get an upgrade offer, you may contact the bank and highlight the long-standing relationship and the good net relationship value (NRV) you have with them and request for a credit card upgrade. Good credit score: If you make timely payments, maintain a CUR below 30%, have a good mix of secured and unsecured credit, hold loans/credit cards with long ageing, etc., you will have a good credit score. Maintaining a good credit score is an important factor, along with other factors, that can make you eligible for a credit card upgrade. In the earlier section, we understood how an individual can become eligible for a credit card upgrade. If you meet the above eligibility criteria, you may have already received a credit card upgrade offer. You can check for credit card upgrade offers in your net banking or bank mobile app in the credit card section. You may have received communication on the credit card upgrade offer through email, WhatsApp, SMS, phone calls, etc. Once you accept the card upgrade offer, the bank processes the request. Usually, a credit card upgrade offer doesn't require KYC and income documents, as the bank already has this information. The bank will send you the upgraded credit card within the specified timelines. At the time of credit card upgrade, most cardholders have reward points on their existing credit card. You need not worry about losing them. The reward points on the existing credit card are transferred to the upgraded credit card in a specified ratio. For example, if an individual's credit card is upgraded from HDFC Bank Regalia to HDFC Bank Diners Club Black, the reward points will be transferred in the 2:1 ratio. It means every 2 Regalia reward points will be converted into 1 Diners Club Black reward point. For example, at the time of upgrade, if the Regalia Credit Card has 1,000 reward points, they will be transferred to Diners Club Black Credit Card as 500 reward points. The monetary value of the reward points remains the same after the transfer to the new credit card. If you have received a credit card offer with better features and benefits, you may consider going for it. If you get a higher credit limit on the new card, and your monthly expenses remain the same, it can lower your CUR and contribute towards improving your credit score. The better features and benefits will give you a higher value for every Rupee spent using the card. However, check the annual fees on the upgraded credit card, which will usually be higher than the existing card. Also, your existing card may be lifetime free and the upgraded card may be paid. So, before upgrading, check whether you are okay with the fee structure of the new credit card. Gopal Gidwani is a freelance personal finance content writer with 15+ years of experience. He can be reached at LinkedIn.
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Business Standard
23-05-2025
- Business
- Business Standard
The credit card reward mirage: High earn rates, low real returns
Swipe, earn, repeat. That's the rhythm many of us follow with our credit cards, driven by the thrill of earning points on every transaction, be it a coffee run, an online order, or a weekend getaway. But here's the catch: not all points are created equal. While flashy ads boast of earning '5X reward points' on spends, what they often leave out is the most important detail: What are those points actually worth when you redeem them? 'A high rate of earning points doesn't necessarily mean better returns if those points have low redemption value,' says Adhil Shetty, chief executive officer of It's not about how many, but what they're worth Credit card rewards are only as valuable as their conversion rate. Shetty explains with an example: a card offering 5 points per Rs 100 might seem superior. But if each point is worth only Rs 0.10, the return is just Rs 0.50 per Rs 100. Meanwhile, another card offering 2 points per Rs 100, but with each point worth Rs 0.50, yields Rs 1 in benefits, double the value. 'It's crucial to evaluate both how many points you earn and what they're actually worth when redeemed,' he adds. Why conversion rates vary Reward point conversion is driven by strategic partnerships and backend negotiations. According to Shetty, airlines and hotel chains often offer better value due to bulk deal arrangements. On the other hand, gift cards or merchandise typically have lower redemption value because of added costs and markups. For example: Travel bookings via card platforms like HDFC's SmartBuy can give Rs 1 per point. The same point might be worth just Rs 0.30 if converted to cashback. Best reward conversions in the market today Here's a quick comparison of some cards with strong conversion systems: Standard Chartered Ultimate: Rs1 per reward point across most options. HDFC Infinia & Diners Club Black: Rs 1 per point on travel via SmartBuy. Kotak Solitaire: Direct 1:1 conversion to Air India miles. Cards like Axis Bank Magnus and BoB Eterna also offer high earn rates, but their value depends on how (and whether) you redeem them effectively. (Above mentioned data is provided by Common mistakes to avoid Shetty points out several traps: Focusing only on points earned, not on their actual worth. Redeeming points for low-value options like merchandise. Overspending just to earn rewards, which can lead to debt.
Mint
05-05-2025
- Business
- Mint
Shopping online? ICICI Bank's iShop portal offers big rewards—Here's what you get
Some banks have separate platforms that reward their credit holders when they transact through that platform. These platforms offer accelerated reward points when a credit cardholder shops, and also offer various options for redeeming reward points. For example, HDFC Bank has the SmartBuy platform that provides credit cardholders with opportunities to earn accelerated reward points and redemption options. Similarly, American Express has the Reward Multiplier platform that provides credit cardholders with opportunities to earn accelerated reward points. In February, ICICI Bank introduced the iShop portal to reward its credit cardholders. In this article, we will understand what is the iShop portal, its accelerated reward points program, redemption options, etc. The iShop portal from ICICI Bank allows its credit cardholders to book flights, bus tickets, hotel accommodation, purchase gift vouchers, etc., and earn accelerated reward points of up to 12X. The accelerated reward points multiple depends on the credit card variant held and the type of transaction done. Similarly, the iShop portal allows credit cardholders to redeem their reward points against booking flights, bus tickets, hotel accommodation, purchasing gift vouchers, etc. The iShop portal provides 12X reward points for booking hotel accommodation, and 6X reward points for booking flights, bus tickets, and purchasing gift vouchers. The reward rate or the value back can be up to 36%, depending on the credit card variant held. The table below shows the reward rate in the form of accelerated reward points on various credit cards for various transactions done on the iShop portal. Credit Card Flight booking (6X) Hotel accommodation (12X) Gift vouchers (6X) Emeralde Private Metal 18% 36% 18% Times Black 12% 24% 12% Emeralde 6% 12% 6% Other ICICI Bank credit cards 3% 6% 3% ICICI Bank co-branded credit cards 4% cashback 4% cashback 4% cashback The above table shows how the Emeralde Private Metal and Times Black credit cards provide great value to cardholders for transactions on the iShop portal. Please note that there are monthly limits on the accelerated reward points that can be earned for every credit card. For example, for Emeralde Private Metal Credit Card, the accelerated reward points are capped at 18,000 per month. Similarly, for the Times Black Credit Card, the monthly capping is 15,000 reward points. A cardholder can purchase Amazon Pay and Flipkart gift vouchers for a maximum of Rs. 12,000 monthly. The reward points can be redeemed on the iShop portal against transactions in various categories. Some of these include booking flights, hotel accommodation, purchasing gift vouchers, etc. The value of each reward point for redemption against booking flights, hotels, and purchasing gift vouchers is Rs. 1. It means 1 reward point = Rs. 1 for redemption against the transactions mentioned above. There are limits on the percentage of the transaction value that can be paid through reward points, as follows. Redemption transaction Percentage of transaction value that can be paid with reward points Flights booking 100% Hotel accommodation 90% Gift voucher purchase 60% So, for flight booking, the entire transaction value can be paid with reward points. For hotel bookings, 90% of the transaction value can be paid with reward points. The remaining 10% must be paid with the ICICI Bank credit card. Similarly, for gift voucher purchases, 60% of the transaction value can be paid with reward points. The remaining 40% must be paid with the ICICI Bank credit card. A minimum of 500 reward points must be redeemed in a single transaction. A redemption fee of Rs. 99 + GST will be charged per transaction, except for Emeralde Private Metal and Times Black cards. The reward points can also be transferred to Air India's loyalty program (Maharaja Club). ICICI Bank's competing banks, like HDFC Bank, Axis Bank, American Express, HSBC Bank India, etc., have multiple airline and hotel loyalty transfer partners. In future, ICICI Bank is also expected to introduce new airline and hotel loyalty partners, on the lines of its competitors. A customer can buy gift vouchers of several online and offline brands through the iShop portal. So, whether you want to purchase gift vouchers and earn accelerated reward points or purchase gift vouchers by redeeming reward points, you can do it through the iShop portal. When you use your credit card directly online or at a POS machine at an offline merchant outlet, you earn base reward points. However, if you buy a gift voucher of the same online/offline merchant through the iShop portal and then pay the merchant through the gift voucher, you multiply your reward points. With the HDFC SmartBuy platform and American Express Reward Multiplier platform, the cardholders of these banks can earn accelerated reward points and transfer them to airline and hotel loyalty partners. However, so far, the ICICI Bank credit cardholders did not have these benefits. With the introduction of the iShop portal, ICICI Bank credit cards can now earn accelerated reward points of up to 12X reward points. It is a significant additional benefit that the cardholders can get. So, the iShop portal definitely enhances the value proposition of ICICI Bank credit cards. Currently, banks like HDFC Bank, Axis Bank, HSBC Bank India, American Express, etc., have various hotel loyalty transfer partners. Some of these include Marriott Bonvoy, Club ITC, Accor Live Limitless (ALL), IHG One Rewards, Wyndham Rewards, etc. Similarly, they have various airline loyalty partners. Some of these include Maharaja Club, KrisFlyer, Japan Airlines, Etihad Guest, Air Canada Aeroplan, United MileagePlus, Miles & Smiles, etc. Currently, ICICI Bank has one reward points transfer partner i.e., Maharaja Club, the Air India loyalty program. In the future, if ICICI Bank adds other airline and hotel loyalty partners for transferring reward points, it will provide more redemption options to cardholders. With the introduction of the iShop portal, ICICI Bank has matched its competing banks in providing its credit cardholders an opportunity to earn accelerated reward points. As and when ICICI Bank brings more transfer partners on board, it will further match its competing banks in providing its credit cardholders with more reward points redemption options. The move will further enhance the value proposition of ICICI Bank credit cards. Gopal Gidwani is a freelance personal finance content writer with 15+ years of experience. He can be reached at LinkedIn. First Published: 5 May 2025, 09:42 AM IST
Yahoo
16-03-2025
- Business
- Yahoo
Illinois' SmartBuy Program Forgives Student Loans To Help Potential Homeowners Buy Real Estate
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. If you want to eliminate your student loans, move to Illinois. That's what happened to James Ekstrom, who was able to purchase his first home through Illinois Housing Development Authority's Smart Buy Program after having $37,000 of student loan debt forgiven, Fox 39 WTVO reported. 'So all of that, the whole $37,000, got paid off,' Ekstrom said. 'I actually just checked on my accounts a couple of days ago, and I saw it, and I was like, Wow, it doesn't even feel real at the moment.' Don't Miss:This Jeff Bezos-backed startup will allow you to . The program was designed to help homebuyers with student loans enter the housing market. According to a 2024 report from the National Association of Realtors Research Group, 23% of all homebuyers had student loan debt, with a median debt of $30,000. 'With the additional money that I don't have to pay towards student loans anymore,' Ekstrom said, 'I plan to continue reinvesting that money definitely into this property and also plan on actually creating another account to set some capital aside to eventually, in the near future, probably very soon to acquire another property, possibly.' Trending: CEO of Integris gathered a team of senior investment managers who have $34.22 billion in combined owned and managed assets in the West Coast — Illinois Gov. J.B. Pritzker launched the SmartBuy program to enable access to affordable homes in the state despite buyers' financial burdens. It achieves this by providing financial assistance and debt relief. 'Fifteen years ago the average age of a first-time home buyer was 29. Today, it's 38,' Northwest Illinois Alliance of Realtors CEO Conor Brown said. 'It's really kind of sounding the alarm bells that the student loan debt is not sustainable. So, we need to think of ways that help alleviate some of that stress.' Although applications to the SmartBuy program are currently closed as funding has been exhausted, a few other states offer similar programs. These include:Kansas has more than 90 counties designated as Rural Opportunity Zones. According to the Kansas Office of Rural Prosperity, potential homebuyers in the state who move into one of those counties can receive student loan repayment assistance and/or a 100% state income tax credit. The student loan reimbursement assistance offers up to $15,000 in aid over five years. Maine's Student Loan Repayment Credit is administered by the Maine Revenue Service. The program offers a refundable tax credit of up to $2,500 annually.. Maryland offers the SmartBuy 3.0 program. It provides homebuyers with $6,000 in down payment assistance and student loan repayment assistance. The program will pay off a student loan equal to 15 percent of the home cost, with a maximum payoff of $20,000. Borrowers must also qualify for the Maryland Mortgage program. Michigan offers up to $300,000 in tax-free student loan repayment assistance for health workers who agree to work in the Health Professional Shortage Area. To qualify for the full repayment assistance amount, participants must apply through the Michigan State Loan Repayment Program and participate in the program for at least two years. Real estate is a great way to diversify your portfolio and earn high returns, but it can also be a big hassle. Luckily, there are other ways to tap into the power of real estate without owning property. Arrived Home's Private Credit Fund's has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate. The best part? Unlike other private credit funds, Looking for fractional real estate investment opportunities? The features the latest offerings. This article Illinois' SmartBuy Program Forgives Student Loans To Help Potential Homeowners Buy Real Estate originally appeared on Sign in to access your portfolio
Yahoo
06-03-2025
- Business
- Yahoo
Illinois program helps first-time homebuyer overcome student loan debt
ROCKFORD, Ill. (WTVO) — A Rockford resident bought his first home thanks to an Illinois program that helps former students pay student loan debt. James Ekstrom said he would have been looking to buy a home earlier on in his life, but thousands of dollars of student loan debt was in his way. '15 years ago the average age of a first-time home buyer was 29. Today, it's 38,' said Northwest Illinois Alliance of Realtors' Conor Brown. 'It's really kind of sounding the alarm bells that the student loan debt is not sustainable. So, we need to think of ways that help alleviate some of that stress.' Last month, Ekstrom was able to become a first-time homebuyer, thanks to the Illinois Housing Development Authority's program for student loan debt. The SmartBuy program relieved him of $37,000 of debt. 'So all of that, the whole $37,000 got paid off,' said Ekstrom. 'I actually just checked on my accounts a couple of days ago and I saw it and I was like, Wow, it doesn't even feel real at the moment.' Nearly one in five non-homeowners said debt is their main reason for not purchasing a home, according to a . As a result, more programs are becoming available to aid buyers. 'With the additional money that I don't have to pay towards student loans anymore,' said Ekstrom. 'I plan to continue reinvesting that money definitely into this property and also plan on actually creating another account to set some capital aside to eventually, in the near future, probably very soon to acquire another property, possibly.' While applications for the program are currently closed, the Illinois Housing Development Authority has other programs to help homebuyers. Anyone interested can visit the organization's . Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
