SBI Card caps reward points: Here’s what you need to know

SBI Card has made important changes to their reward points ‘structure for different credit cards such as SimplyCLICK and Air India SBI cards. The upcoming changes that will begin from March 31 and April 1, 2025, will see cardholders who are habitual users of their credit card for online shopping, dining, and travel spending should consider rethinking their reward-earning tactics.

The New Reward Points Structure

From April 1, 2025, SBI Cardholders will see the earning reward points in various categories of spends reduced. Although these changes largely affect SimplyCLICK SBI Card users, others who hold SBI credit cards apart from Air India credit cards will realize a drop in the rewards they get from some purchases.

SimplyCLICK SBI Card Changes

Being one of the cards that has given a great hike to online shopping, the SimplyCLICK SBI Card has been particularly popular to earn accelerated reward points on online shopping. However, the reduction of the reward points for some platforms:

Swiggy Purchases: From 10X the reward points on food on delivery service, it will come down to 5X for every ₹100 spent. However, this change will leave a lot of cardholders who enjoyed the higher reward rate on food orders disappointed.

On the positive side, customers will still get 10X reward points for transactions done on other E Commerce and Service Platforms such as Apollo 24X7, BookMyShow, Cleartrip, Domino’s, Myntra, Netmeds, IGP and Yatra. However, the Swiggy reduction will sting the most, which means that customers can still accumulate valuable points on travel, entertainment and e commerce websites.

List of Air India SBI credit cards Changes

In the other case, if the reward points structure has been revised for Air India SBI credit credit cardholders:

• For Air India Tickets, the reward points are reduced to 5 points per ₹100 spent from 15 points per ₹100 spent for Air India Platinum Credit Card holder SEE Change is significant for frequent flyers who have been opting for their cards to book flights with Air India.
• The other Air India Signature credit card holders shall similarly see a drop in their reward points from 30 points per every ₹100 spent to 10 points per every ₹100 spent for Air India ticket purchases.
• Which can cut down the overall amount of value a customer may derive from their Air India SBI cards if they frequently book a flight or have points to be redeemed for travel.

Insurance Coverage Changes

Apart from the changes in the rewards program, SBI Card has said that it will discontinue free insurance coverage for cards from July 26, 2025. The affected insurance coverage includes:

• Finally, cardholders will no longer have ₹50 lakh of coverage available to them under the Air Accident Insurance.
• In addition, it will stop offering Rail Accident Insurance (to the tune of ₹10 lakh).
• The bank is making these changes as part of an effort to realign its card offer and lower operational costs. The loss of such insurance benefits will lead to cardholders who valued them needing to find alternative coverage options to stay covered.

Why These Changes Are Happening

From the bank’s perspective, the reduced reward points and lack of insurance benefits may have been an effort to improve profitability by minimizing the cost related to free reward system or free insurance, in the highly competitive credit card market. However, over the years, credit card issuers, including SBI, have felt the need to provide lucrative advantages to retain customers even as they optimize operational costs. As the number of customers choosing credit cards for their online transactions increases, especially in the digital realm, it is a response to changing market dynamics.

However, despite the disappointment by the changes to some customers, they are a part of the trend in the financial services industry where banks and credit card providers are reviewing the structure of their rewards and benefits. In this particular case, SBI Card appears to be changing with these market pressures reducing its cost of reward point issuance at the expense of the categories that may have overshot their generosity in the past.

What This Means for SBI Cardholders

In the case of SBI cardholders, especially people who have been stacking up reward points while ordering food online or booking such frequent travels, the situation becomes inconvenient. The cardholders also need to reappraise the number of times on which they use cards for booking services like Swiggy and Air India.

What Should You Do?

These changes, for cardholders, should be reviewed, and adjusted spending to maximize rewards should be considered. They should also assess other credit cards that could provide better rewards in the dining, travel or online shopping categories.

Taking into account the reduced insurance coverage, it may partly be justified for SBI cardholders to opt for such supplementary insurance policies to keep themselves insured.

Final Thoughts

In these changes, SBI Card has terminated the complimentary insurance coverage and reduced the reward points and will affect a major chunk of the cardholder base. While this is not ideal news for anyone, there are still a number of things that credit cardholders can do in to make the best of their credit cards by using platforms that have the best rewards. These popular credit cards will be key to staying informed and a pragmatic change in spending habits to maintaining value.