Series Layout

Welcome to the Travel Hacking from Scratch Series – a series dedicated to getting those new into Travel Hacking up the curve as quickly as possible. Below is the layout of the series with links back to already published articles.

Today our topic is Referral Bonuses, a trick that you can employ to help accelerate the number of miles/points that you collect.

If you’ve been following along in the series, you’re probably expecting US Credit Cards as a topic. I’ve skipped over it because I have a surprise in store for you – an almost surefire way to qualify for US cards. I’m not quite ready to reveal what that is just quite yet, so today we are talking about Referral Bonuses instead. Check back later next week for US Credit Cards.

The Benefits of Travel Hacking
Earning Points
Credit Cards – Which Card and Why
Category Bonuses
Churning Credit Cards
US Credit Cards (ITIN)
Referral Bonuses
Manufactured Spending
Using Your Points
Alternatives to DIY
Understanding the Power of Partners
Weighing Convenience vs Cost
How to Avoid High Taxes and Charges
Sweet Spots
How to Travel Better
Why You Need Status
Leveraging Status
Understanding Your Rights
Beyond Travel – Financial Freedom

What Are Referral Bonuses?

Referral Bonuses are miles/points that you collect for convincing your friends or family to sign up for a credit card. One of the most difficult things for a credit card company to do is to convince potential clients to apply and use their credit products.

You may remember kiosks set up at the college or university that you went to that offered tempting credit card bonuses or cards with no annual fees … you may have even gotten a U of C sweatshirt out of it (not that I fell for that trick … okay fine, I did). The reason that card companies target university students is that, for the most part, students don’t really understand what it is they are signing up for, so it’s a target-rich environment. The theory here is that once you get hooked into a bank through their credit card offering, you are more likely to accept their other credit products. They may even convince you to bank with them … and you may even trust them enough to fund your home purchase through their mortgage offerings.

Once people get out of university, they become much more guarded when it comes to credit products. I’m of course using a very broad brush to paint this picture but it’s a pretty accurate depiction of what happens in the real world.

This is why you see VERY lucrative sign-up bonuses for most credit cards. Banks and card issuers know that it’s very difficult to convince people to get a credit product, much less their credit product.

This is where referrals come into the picture.

What’s the Benefit for the Banks?

There are two major reasons why banks and card issuers provide lucrative referral bonuses:

  1. It’s cheaper than convincing someone through marketing – you would not believe how much money is spent on TV, radio, print, and online advertisement in an effort to convince you to sign up for a credit card. It takes soooooo many touches for a company to have its product register in your consciousness. It then takes a lot more effort to convince you to sign up for the card.

    As an example, I have been thinking that I need a lot more cardio and coincidentally, Peleton has been advertising a lot on TV, specifically during prime time viewing (expensive). I knew about the concept during my cycling days so I understood the value proposition but even then, I couldn’t be bothered to learn more about the product, even though it wouldn’t take much effort to jump on their website. Peleton has spent a TON of money trying to convince me to even type in my browser’s address bar but yet, I haven’t made any effort to do so.

    But what would have happened if I ran into a friend that had lost 30lbs since I last saw him and he talked to me about how Peleton has made a dramatic difference in his health. How much more likely am I to now look into the product? I would say 100% more likely. This is the number one reason why referrals are so effective.
  2. Built-In Advocate – In the past few weeks, I have heard so many people at my new office say things like “I hate Aeroplan” or “I get no value out of the WestJet credit card”. Once banks or card issuers convince you to get their product, their job isn’t even close to done. They want to retain you but it’s difficult for them to show you the value of their program if you aren’t the one taking the initiative to learn. Just like in any industry, new clients are difficult to attract and difficult to retain.

    If I had referred the people I referenced above to the TD Aeroplan card or the RBC WestJet credit card I would be their go-to guru on all things related to the card. The people that are referred to a program are also much more likely to consult with the person that referred them rather than the issuer. This serves a dual purpose. It saves the issuer from paying for expensive phone calls into their call centres to answer questions about the program and it reduces the likelihood of cancellation. People referred to a program are more likely to say “if Jayce gets amazing value out of this card, I’m probably not using the points/miles correctly”. Those that aren’t referred are likely to just cancel the card.

    Ultimately it’s much cheaper to pay a referral bonus than it is to attract and retain a cardholder through traditional channels.

How Does This Help Me?

I think this part is pretty obvious but if you have strong knowledge of a credit card product that offers a referral bonus, you can convince your friends and family to sign up and reap the additional miles/points.

Unfortunately, there are only a few card issuers in Canada that provide a referral bonus, the most generous being American Express but the catch is that you have to hold the card in order to refer people to it.

Currently, the American Express Platinum Business card provides a 25,000 Membership Reward bonus if you can convince someone to get the card. That referral bonus has fluctuated in the past and has dipped to as low as 15,000 but it’s back up to 25,000.

Word of Warning

Every referral bonus that I have ever seen uses the “last click” attribution, meaning that even if you do all the heavy lifting of convincing your friend to get the American Express Platinum Business card, it doesn’t count unless they use your link to apply.

As an example, say you convince your friend to get the card and they ask for your referral link. They click the link but then get tied up with something else. When they come back, they decide to get a bit more information on the American Express website prior to applying and click on an Apply Now button on the American Express website. American Express will not provide you with the referral bonus. They won’t even give you the lemons they tell you to suck.


You can imagine how quickly your miles/points balance can shoot up if you can convince others to sign up for a credit card but it’s not quite that easy. In order for people to trust you, you really need to know the ins and outs of the program you are referring to, otherwise, you won’t have any success.

Again, apologies for the out of order post this week but I promise to make it worth your while by opening up the world of US credit cards. Stay tuned.

Series Navigation<< Travel Hacking From Scratch – Part 3 – Category BonusesTravel Hacking From Scratch – Part 4 – Churning Credit Cards >>
Jayce is the founder of PointsNerd, and avid traveller and a teacher by nature. He prides himself on flattening the learning curve through step-by-step guides because everyone needs to start somewhere.


    • Frank,

      Bear with me … it’s coming. I covered this off in the 3rd paragraph above:

      If you’ve been following along in the series, you’re probably expecting US Credit Cards as a topic. I’ve skipped over it because I have a surprise in store for you – an almost surefire way to qualify for US cards. I’m not quite ready to reveal what that is just quite yet, so today we are talking about Referral Bonuses instead. Check back later next week for US Credit Cards.



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