02/13/2009 05:12 am ET Updated May 25, 2011

Banks, Credit Cards Scaling Back Reward Plans

The latest currency devaluation is happening in your bank's and credit card's reward programs.

Airlines have been devaluing their frequent-flier programs for some time, stepping up the number of miles required to qualify for free flights and adding restrictions. But until recently, banks had still been sweetening their rewards programs -- adding more flexible redemption options and bigger cash-back bonuses to snag customers.

Now, with the economy contracting and fears rising about credit-card delinquencies, banks are trying to cut costs and bolster profits. Many card issuers have been testing shorter expiration periods, higher redemption fees or earnings caps on rewards. "You'll start to see all of those put into place starting in 2009," says Megan Bramlette, a London-based managing associate at Auriemma Consulting Group.

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