Who: This post is for people who have a lot of unused frequent flier or customer appreciation points from various airlines, retailers, and other merchants. This post will be helpful if you have heard of Points.com and are thinking about signing up and/or trying it.
What: This post will review the pros and cons of Points.com, a website where you can trade, transfer, purchase, and redeem frequent flier miles and points from a variety of customer appreciation programs.

What is Points.com

Points.com is a service that allows users who are members of multiple frequent flier programs or consumer rewards programs to make various exchanges between programs. The website allows you to redeem points for gift certificates or certain prizes and allows you to transfer points between different programs. The website makes its profits by taking a small cut as an “exchange fee” between programs.

Pros:

1) This site is great for those who have earned points on an airline that they don’t plan to use that often. If you think you’ll never earn enough points to get something meaningful, you can always swap points (to or from another program) or just redeem them for a gift certificate.

2) There are a fair number of frequent flier programs that are members of the points.com network so you have quite a variety of choices when swapping between programs. There are also a few consumer rewards programs that participate as well. The big members include (but are definitely not limited to) American Airlines, Delta, Northwest, US Airways, Cruisepoints, Starwood points, American Express, and e-Rewards.

3) There are also a fair number of retailers from which you can purchase gift certificates using points, including Amazon.com, Sears, Best Buy, Target, and more.

Cons:

1) While the #2 point in the Pros section is true, the flip side of the coin is that there ARE a ton of frequent flier programs, credit card programs, and consumer rewards programs that just are not in the points network. There is limited reach of this network, so it’s utility for you will vary based on the exact programs that you’re a member of. The notable programs that are NOT members of the program are the Citi Thank You Network, Marriott Points, and Hilton Honors Points.

2) The exchange rates are just horrific. The cut that points.com takes for transactions borders on highway robbery. I would never actually make an exchange unless I was very, very desperate. A lot of the exchange rates for gift certificates and swapping points into programs is not very good either.

3) There are a ton of restrictions on the programs that are members of the network. Many network programs won’t let you redeem points or even swap points out of the program. These restrictions make it very difficult to do exactly what you want to do.

Final Thoughts

In the end, I have to say… Points.com sucks. The major issue I have are the Cons #2 and #3. They really destroy the value that the consumer can get for this site. If they worked to expand the selection of programs and took a smaller cut, I think that this would become a much more widely used site. The only utility I see for this site is redeeming points on “dead” programs that you’ll probably never earn points on again.

Final Verdict: D
Note: This verdict reflects a highly complex algorithm which determines how awesome a financial product is. This is not limited to point-swapping websites.

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