When Chase unveiled a slew of changes to its uber-popular *chase sapphire preferred* on Wednesday — including doubled hotel credits, a new Global Entry or TSA PreCheck® credit, and no increase to its $95 annual fee — one thing immediately came to mind: Where's the catch?
Here it is: Soon, Preferred cardholders' points won't go nearly as far when transferred to World of Hyatt.
Effective Oct. 1, existing Chase Sapphire Preferred cardholders will transfer Chase points to Hyatt on a 4:3 basis, meaning you'd need to kick over 67,000 Ultimate Rewards to wind up with at least 50,000 points for a free night. Same goes for the popular small business card, the *chase ink preferred*. And for new applicants applying for the card as of June 15 and onward – when the raft of changes to the card take effect – that negative change kicks in immediately.
You'll need the top-tier *chase sapphire reserve* and its $795-a-year price tag (or the small business version) to keep sending Ultimate Rewards to Hyatt on a 1:1 basis. And that's the goal: to convince travelers to pony up for a far pricier card in order to get the most out of their points.
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Coming just weeks after Hyatt's drastic changeover which saw award rates increase at hundreds of popular properties, this is a brutal one-two punch for Chase points that, for many travelers, were all but earmarked for Hyatt redemptions. It could steer travelers even further toward Bilt Rewards, the only other Hyatt transfer partner where 1:1 transfers remain the standard.
Here's an example of how much this will sting.
Previously, a Sapphire Preferred cardholder could book a free night stay at the Park Hyatt Tokyo for no more than 45,000 points per night. With Hyatt's new, five-tiered award chart with far steeper rates during busy dates, that could now cost as much as 75,000 points.
And come Oct. 1 when this change to Hyatt transfers takes effect (for anyone who applies before Monday, June 15), you'd need 100,000 Chase points from the Preferred Card to book that same award stay. In a matter of months, the cost of some award nights will have more than doubled. Ouch.
Of course, that's on the high end. And if there was any big winner in Hyatt's award chart swap last month, it was on the cheap Category 1 and Category 2 properties – the vast majority of which got even cheaper in Hyatt's new system.
But even there, it'll wind up costing you more points from the Preferred Card once this change kicks in. Even the cheapest, 3,000-points-a-night stay during the slowest periods will soon require transferring 4,000 Chase points to book – unless you opt for the Reserve Card, of course.
What's Next?
On its face, this move is bad enough. For a decade or more, World of Hyatt has been the go-to favorite for redeeming Chase Ultimate Rewards.
But I can't help but feel like Chase just crossed the rubicon.
Other banks like American Express and Capital One have long offered confusing and subpar transfer ratios to several partners, but not Chase: Everything moved 1:1. It was easy, straight forward, and valuable. Heck, while Emirates forced several banks to tweak those transfer ratios for the worse, Chase dropped them like a hot potato rather than shift to a 5:4 transfer ratio.
But Hyatt is a different breed. Chase couldn't lose Hyatt – not with its outsized reputation among Chase cardholders … not to mention their co-branded credit card relationship.
Clearly, Chase is confronting the same reality in the growing world of award travel that is driving the rising award rates, diminishing award space, and the other negative changes.
What was once a niche hobby confined to online forums has gone fully mainstream. With the help of sites like ours, an explosion of award tools, and especially social media influencers, more Americans are collecting and redeeming points (and more of them) than ever before.
So maybe something had to give after the hundreds of millions (if not billions) of points Chase cardholders have sent to World of Hyatt accounts over the years. By cutting transfer ratios for all but top-tier Reserve cardholders, Chase creates a powerful incentive to upgrade.
That's troubling for two reasons:
- It opens the door for Chase to make similar moves with other transfer partners
- And it gives other banks like American Express, Capital One, Citi, and maybe even Bilt cover to do the same
Maybe this is a one-and-done … but honestly, I doubt it.
Bottom Line
Effective Oct. 1, longtime Chase Sapphire Preferred cardholders will no longer be able to transfer points to Hyatt on a 1:1 basis. Instead, they'll move on a 4:3 basis … unless you have the premium Chase Sapphire Reserve or its business equivalent.
On the heels of Hyatt's massive award chart shakeup last month, this one hurts.
