Do You Lose Your Points If You Cancel Your Credit Card?

There are many reasons you might want to cancel your credit card, but before you do, consider using the points you’ve earned. Many credit cards won’t let you keep rewards like points or cash back once you close the account – unless you earn the rewards through a third-party company. We’ll explain this and walk you through options for using your points before you cancel your credit card.

Rewards programs in Canada

Credit card issuers and third-party companies set the terms and conditions of the best rewards programs in Canada – including whether or not you can keep your points after cancelling a credit card.

As a rule of thumb, if you only earn points by using a specific credit card, you probably can’t. But if you earn points by using multiple payment methods at a certain store, you probably can.

Credit card rewards programs

Credit card rewards programs are exclusive to certain banks, credit unions, and credit cards. For example, RBC owns Avion Rewards, Desjardins owns BONUSDOLLARS, and National Bank owns the À La Carte Rewards program. Cancelling your card generally closes your rewards account, as well, sending all your hard-earned points into the void.

In general, the only way to save them is to transfer them to another person’s account, convert them into third-party rewards points, or redeem them before cancelling your card – if the company allows it, that is. You’ll have to contact customer service or read the guide below to find out.

Be warned that you’ll lose any cash back you’ve earned but haven’t redeemed if you cancel a cash back credit card. If you can, cash out your rewards before cancelling. This might mean you have to wait until the card’s anniversary (if that’s when the issuer awards cash back).

Third-party rewards programs

Third-party rewards programs are free and award points when you buy certain goods or services or shop at certain stores. Think McDonald’s Rewards, the Marriott Bonvoy program, or Tim’s Rewards.

Because they aren’t tied to a specific card, you can safely cancel your credit card without losing your points. That’s not to say that credit card issuers don’t also manage third-party programs – some of the best third-party rewards programs in Canada belong to major banks.

How to cancel a credit card without losing your points

You may be able to hold onto your points even if your current rewards credit card isn’t working out. Before cancelling your card, try:

• Converting your points into rewards points for a different rewards program like Aeroplan, Hilton Honors, Delta SkyMiles, etc.
• Gifting your points to someone
• Redeeming your points for rewards
• Pooling your points with several family members
• Transferring your points to someone else’s account
• Transferring your points to a new or existing credit card in your name from the same company

Not every rewards program will let you convert, gift, or transfer points, but it doesn’t hurt to ask. Some companies, like Air Miles, will even reinstate your points for a fee if you change your mind and re-apply for a credit card.

Do you lose points if your credit card company cancels your card?

Cancelling your own credit card isn’t the only way to lose points. You could forfeit all your rewards permanently if:

• Your credit card company cancels your card for inactivity
• Your credit card company cancels your card for missing payments
• You’re caught churning or applying for multiple credit cards for the welcome bonuses

Third-party companies can also close your account if it’s inactive for 18 to 24 months or if you break the rewards program’s terms and conditions. In both cases, your points are usually lost forever.

FAQ

Does closing a rewards credit card affect your credit score?

Closing a rewards credit card can lower your credit score because it decreases your credit mix and overall credit limit, which raises your credit utilization ratio.

Do I lose my points if my credit card gets cancelled?

Whether you lose your points depends on why your credit card was cancelled – if it was due to inactivity, a quick phone call to customer service could restore your points. If your card was cancelled because it fell into bad standing, you probably can’t appeal the loss of your points.

How long does your points account have to be inactive for it to be closed?

Most rewards programs consider closing your account after 18 to 24 months of inactivity.