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Australia's major banks and other card providers are cutting rewards and benefits on business credit cards. Analysis by Money.com.au found changes to interest-free periods, insurance cover and reward point values.
The changes affect cards issued by ANZ, CommBank, Westpac, St.George, BankSA, Bank of Melbourne and NAB. They come amid broader card payment reforms, though Money.com.au noted that the reduction in interchange fee revenue affecting most consumer cards does not apply to commercial cards.
For businesses, that means fewer benefits on products often used to manage working capital and regular operating expenses. Some cardholders will have less time to pay balances without interest, while others will lose travel and purchase protections or get less value from reward redemptions.
Reserve Bank of Australia data cited in the analysis shows there are about 733,000 commercial credit and charge card accounts in the country, including 491,000 active accounts. Businesses spend almost AUD $10 billion on credit and charge cards each month, or roughly AUD $20,000 per active account.
Interest-free cuts
ANZ is reducing the maximum interest-free period on its ANZ Business Black and ANZ Qantas Business Rewards cards from 55 days to 44 days, shortening the window for businesses to clear balances before interest is charged.
For small and medium-sized firms that rely on cards to manage short-term cash flow, an 11-day reduction can add pressure to payment cycles. It also leaves less room to bridge gaps between supplier invoices and incoming revenue.
Insurance removed
CommBank is making several changes to its business card features. CommBank is closing its CommBank Awards program and replacing it with CommBank Yello points, with eligibility and earn rates linked to whether customers use a CommBank transaction account.
The bank is also removing several types of insurance from its Business Gold Awards Card, including trip cancellation, baggage and personal goods, baggage delay, extended warranty and purchase security cover.
On the Business Platinum Awards Card, trip cancellation cover for the cardholder is being cut from AUD $5,000 to AUD $2,500, while cover for the cardholder and family is being reduced from AUD $10,000 to AUD $5,000. Extended warranty, purchase security, guaranteed pricing and interstate flight inconvenience cover are also being removed.
Points changes
Westpac and the banks with similar rewards structures are increasing headline earn rates on some business cards while reducing redemption value. That means businesses may collect points faster through spending but get less when they redeem them.
On Westpac's Altitude Business Gold card, the earn rate on eligible domestic and international purchases is rising from 1 to 1.5 points per AUD $1, while the government earn rate remains at 0.5 points. On the Altitude Business Platinum card, the domestic earn rate is increasing from 1 to 1.5 points per AUD $1, the international rate from 2 to 2.5 points, and the government rate from 0.5 to 1 point.
At the same time, Westpac is cutting redemption rates across various categories. The number of points needed for an AUD $100 eGift card is rising from about 23,500 to 29,412, while the conversion rate from Altitude points to Qantas Points is changing from 2:1 to 4:1.
St. George, BankSA, and Bank of Melbourne are making similar changes to cards linked to Amplify Points. Domestic earn rates are increasing from 1 to 1.5 points per AUD $1, international earn rates from 2 to 2.5 points, and government payment earn rates from 0.5 to 1 point.
Those banks are also reducing redemption value. The number of Amplify Points needed for an AUD $100 eGift card is rising from about 20,000 to 29,412, while the transfer rate to KrisFlyer is changing from 3:1 to 4:1.
NAB has already changed its NAB Rewards Business Signature card. It no longer offers Points Booster bonuses at selected retailers, hardware stores or on overseas purchases, with those transactions instead earning the standard 1.25 NAB Rewards Points per AUD $1. Eligible Webjet purchases continue to earn triple points.
Sean Callery, Head of Insights at Money.com.au, said many operators would find the changes hard to accept.
"The lowering of the interchange fee cap, which is the big driver of the loss in revenue card providers will see from next month, does not apply to commercial cards. Business owners who will have their credit card benefits cut will understandably feel hard done by," Callery said.
He said some revisions could be misleading because higher earn rates did not always mean better rewards value.
"The devil is in the detail with some of these changes too, as it's not immediately obvious that a business could in fact be worse off. For example, Westpac is increasing the domestic earn rate on its Altitude Business cards by 50%, but at the same time doubling the number of points needed when converting them to Qantas Points. In that instance, the changes are a net drop in points value, even though on the face of it the earn rate is higher," he said.
Callery said the timing would add to pressure on firms already facing higher costs.
"Overall, this feels like another kick in the guts for business owners already battling rising costs, high interest rates, mounting wage, energy and insurance bills, and customers cutting back on spending," he said.