I wrote about my credit card predictions for the year 2020 at the very end of 2019. Fortunately, four of the six predictions came true. Now it is time to make some credit card predictions for 2021 as the year dominated by the COVID-19 Pandemic is coming to an end.

2020 saw the credit card landscape change in a plethora of ways. These include issuers offering a plethora of temporary perks and credits, increased sign-up bonuses, and changed earning structures. 2021 might provide us more of the same, especially if the pandemic rages on.


New Non-Travel Permanent Perks

One of the biggest changes of 2020 was the rise of temporary COVID-19 perks among premium and mid-tier credit cards. These perks were designed to provide value while travel was not an option for many cardholders. For example, American Express offered up to $320 in statement credits on select streaming and wireless telephone services on the Platinum Card. These credits lasted from May through December 2020.

My first prediction for 2021 is that issuers will make temporary perks like the cell phone credits permanent. New non-travel permanent perks will also help issuers market premium and mid-tier credit cards to more people, widening their customer base and making them more money. Plus, larger issuers like Chase and Amex will have incentive to keep leveraging existing partnerships to satisfy their existing cardholders.


Chase Will Revamp the Sapphire Cards

Furthermore, I predict that Chase will figure out the puzzle that is the Sapphire Cards in 2021. After the revamp of the Freedom Cards in 2020, the Sapphire Cards need a revamp of their own. 2021 is the best time for Chase to rethink their personal travel card duo. The Sapphire Cards’ earning structure needs a redo, particularly the dining category.

I can see Chase increasing the multiplier for dining to 3x on the Preferred and 4x on the Reserve. This will let them better compete with Amex and Citi while providing more value for their customers in these turbulent times.

Plus, I predict that Chase will also increase the multiplier for the general travel categories on both cards to match the dining category. This increase will let the Sapphire Preferred compete with the American Express Green Card. As for the Reserve, it will be closer to the American Express Platinum Card.

Finally, I predict that Chase will make their temporary grocery store category permanent on both cards. Currently, the Sapphire Preferred earns 2x on groceries while the Reserve earns 3x. Both cards are weaker earners than the American Express Gold Card for groceries. However, the Gold Card only earns one point per dollar on general travel while the Sapphire Cards earn 2x and 3x points in that category, respectively.

Of my credit card predictions for 2021, this is the one that I would like to come true the most. I have held a Chase Sapphire credit card since 2018 and I am disappointed that I cannot use my card optimally right now.


Citi Will Finally Discontinue the Prestige Card

In 2019, I wrote about why Citi should permanently discontinue the Prestige Card. Citi did not discontinue their premium credit card in 2020, but I predict they will in 2021 for the same reasons explained in that post.

Furthermore, the COVID-19 pandemic has ravaged the economy and limited international travel. International air travel is the best way to redeem Thank You points as the majority of the issuer’s partners are international airlines. Citi’s premium credit card was a poor option before the pandemic when the economy was doing well. This was especially true after the 2019 devaluation of perks. During a recession, the Prestige Card’s flaws are even more apparent. Therefore, I predict that Citi will cut their losses in the premium credit card market and focus their resources elsewhere.


Amex Will Discontinue Some Credit Cards

Moreover, I predict that American Express will follow Citi’s lead and discontinue some credit cards. Amex’s product line currently has 14 business cards and 18 personal cards. Amex will discontinue some of the cards that do not offer much rewards or are no longer competitive. Plus, the struggling economy and Amex’s current focus on popular (and valuable) core and co-branded credit cards are more reason to believe that the end is coming for a few cards.

The following cards are great candidates for discontinuation:

The two business cards are seldom mentioned because they offer very little in rewards. However, a plethora of employee Amex cards are Business Green Cards. The Business Green Card will remain as a no annual fee employee card for a Business Platinum or Gold Card and a way to save business owners money. Plus, the Cash Magnet Card is no longer competitive with many other cash back credit cards. Amex will cut their losses with this card and discontinue it.


Amex Will Continue to Close Accounts and Claw Back Rewards

American Express’ Rewards Abuse Team (RAT) has been on a war path over the last two years. They have been closing certain risky customers’ accounts to mitigate the issuer’s risk. Risk is an important consideration for any credit card issuer, especially during a recession. Amex has also been clawing back offers, sign-up bonuses, Membership Rewards (MR) points, and credits for those who they believe have been “gaming the system”. Clawing back rewards is a way to mitigate risk without losing customers.

Unfortunately, I predict that this trend will continue for the third straight year, and that Amex will lose some customers as a result. Angry former Amex customers will switch to Chase or Citi for transferrable points credit cards and other issuers for cash back cards.


Final Draw

With just a few days left in 2020, now was a good time to predict the near future of the credit card landscape. This second iteration of my annual post provides my credit card predictions for 2021. It will be interesting to see which ones come true and which ones do not one year from now.