Bank of America to Launch Expanded Rewards Program
Bank of America announced plans to launch BofA Rewards, a new no-fee loyalty program. The program will be available to any client with a personal checking account. The expansion is expected to make more than 30 million additional clients newly eligible for personalized rewards.
- The new "BofA Rewards" program, launching May 27, replaces the "Preferred Rewards" program which had been in place since 2014. The former program required a minimum three-month average combined balance of $20,000 in Bank of America and Merrill accounts to be eligible for any benefits. - A key strategic shift is the removal of the minimum balance requirement, making the entry-level tier of the new program accessible to any personal checking account holder. This change is part of a broader effort to deepen relationships with the bank's 69 million consumer and small business clients and to make its credit cards "top-of-wallet". - The new program will feature four tiers based on combined Bank of America and Merrill balances: Member (less than $30,000), Preferred Plus ($30,000 to <$100,000), Preferred Honors ($100,000 to <$1 million), and Premier ($1 million+). - For some existing members, the rewards will decrease. For example, customers with balances between $50,000 and $99,999 (the old Platinum tier) who received a 50% bonus on credit card rewards will now be in the "Preferred Plus" tier and receive a 25% bonus. Those in the old "Platinum Honors" tier ($100k+), who received a 75% bonus, will see that reduced to a 50% bonus in the new "Preferred Honors" tier. - The overhaul is part of a larger consumer banking strategy to boost annual profits to $20 billion. This division is now led by Holly O'Neill, who was recently promoted to head of the combined consumer, retail, and preferred lines of business. - Unlike competitor programs such as Chase Ultimate Rewards, Bank of America's program does not offer the ability to transfer points to airline and hotel partners, which is a popular feature for maximizing travel value. The program's strength remains in boosting cash back rewards on Bank of America's own credit cards.
