Is it time to cash in your rewards points?

Credit cardholders may soon have to spend a lot more to reap their card's rewards, which raises the question: should you hedge your bets and cash in your points now? It's probably wise.

The Reserve Bank of Australia wants to even out interchange fees to prevent providers from charging wildly disparate fees depending on their customers' profiles.

Some vendors use higher interchange fees to fund reward programs and these changes could soon make those reward programs more expensive.

For consumers, the cost could be passed on, which will mean having to buy more to rack up those reward points.

The reward points you have already collected probably won't go anywhere, but it may get harder to hit your desired points balance.

The last time this sort of regulation went through, it trickled down to consumers and made it harder for them to reach a high rewards balance as quickly.

If you're close to being able to cash in on something you want, it's worth doing that now rather than shooting for a more aspirational reward.

If you are thinking of getting a new card and like the sound of rewards, it's worth asking whether the RBA change will affect the points program.

Rewards cards generally attract high annual fees, so if the value of the rewards is eroded, it may no longer be worthwhile.

Cards that have already changed following RBA decision

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