2022 has been an interesting year, with post-pandemic travel rebounding, inflation skyrocketing and many credit card issuers offering additional perks, launching new cards or rebranding existing cards.
Although inflation still seems to be on the rise and there’s a potential recession approaching, that’s not stopping travelers. Expedia has deemed 2023 the year of “no-normal” travel, as people are ready to get out and see the world in all sorts of ways. This means credit card rewards could be more relevant than ever to cardholders and budding travelers.
It’s tough to predict the future with exact certainty, but these are our best guesses for how credit card rewards will look in 2023.
Lifestyle Rewards vs. Cash Back vs. Travel Rewards
Back in 2020/21, many cards began to offer additional lifestyle rewards since cardholders weren’t traveling as frequently, such as increased points for shopping at grocery stores. Some of these went away as travel rebounded, while some stuck around.
According to a study from Booking.com, 72% of responders said that despite economic and political concerns, traveling in 2023 “would still be worth it.” Since people are on the move once again, travel rewards cards will continue to stay relevant to consumers.
But considering the state of the economy, cash-back cards may offer some value to cash-strapped cardholders. Only time will tell if issuers focus on lifestyle rewards and cash-back to make everyday purchases a little easier or focus more on travel rewards as travel rebounds.
Flexible Rewards Aren’t Going Anywhere
We’re living in uncertain times—travel is on the rise, yet a possible recession looms. From one day to the next, frequent flyer programs are devaluing miles, so holding on to a large stash of credit card rewards for a rainy day could even backfire as points could be a volatile currency.
This is why flexible rewards cards will remain popular in 2023. With so much uncertainty, one thing is still certain: The ability to transfer points to a variety of programs or use them to purchase travel outright via a portal ensures credit card reward points remain valuable to many types of travelers and spenders, even if or when a specific loyalty program devalues its points.