Ontario’s Ban on Expiry of Reward Points Arrives in 2018

A year after the province said it was banning the expiry of loyalty programs and rewards points, Ontario announced the new ban is now coming into force on January 1, 2018.

Although the Protecting Reward Points Act was passed in Ontario last December, the province revealed the new regulations created as a result of the bill. The new rules will be retroactively applied as far back as October 1, 2016.

The ban—applied to point collecting programs ranging from airlines to retail chains—means consumers that are saving their points no longer have to worry about running out of time to cash in.

“These are important new ground rules that preserve the points consumers have built up over time. Many people save their points for years to use toward a large purchase. That has real value and should be protected,” said Tracy MacCharles, Government and Consumer Services Minister.

The province said that consumers who believe their points have improperly expired can do two things: request that a business reimburse them or file a complaint with Consumer Protection Ontario.

“Reward point programs have become an important tool for businesses to engage consumers in ways that build trust and loyalty for their brands,” said Wally Hill, the VP of government and consumer affairs at the Canadian Marketing Association.

Considering the competition that’s been built into the reward marketplace, Hill said the balanced framework of rules will “reassure points collectors without creating unnecessary program restrictions.”

However, there are some cases when rewards points can still expire. Programs can close a consumer’s account following prolonged inactivity, meaning if they don’t earn or redeem reward points over a long period of time. But the new rules indicate there also must be a second reason to justify the cancellation. Programs dealing only with items under $50 are exempt too, like the lower value reward points plans associated with coffee chains.

Ontario is so far the only province to have this kind of legislation, but Quebec may be next. The province first proposed a similar bill in May and is drafting regulations that are expected to be presented early next year.

While these types of bans rule in favour of consumers over companies, businesses with rewards programs are wise to adopt policies that attract shoppers—or it may hurt their bottom line. Financial research by Accenture released earlier this year found close to 50 per cent of consumers would switch their primary rewards card to get more value for their purchases.