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Should I: Convert Reward points to Airline Miles?

by Apoorv Trivedi on
Rewards conversion

Update: Singapore Airlines revised their award charts on 5 Jul 2022 to require 8-16% more miles for redemption bookings. We explain here why we do not think of this as a devaluation of the KrisFlyer mile and why we continue to value a mile at 1.40¢. As a result, our recommendations here are unchanged.

The Bottom Line

Yes, but only once you have enough points to overcome the drag from conversion fees charged by banks.

Table 1: Minimum points that can be converted to miles profitably

Rewards Program With inefficient use
of miles (1.4¢ / mile)^
With a more
efficient use of
miles (1.7¢ / mile)^
DBS Points 2,000 2,000
OCBC$ 10,000 7,000
OCBC Travel$ 1 1
OCBC VoyageMiles 1 1
UOB UNI$ 2,000 2,000
Citi Points 11,000 8,000
Citi Miles 5,000 4,000
HSBC Points 14,000 10,000
SC* 360° Rewards 11,000 8,000
*SC = Standard Chartered
^ rounded to next highest ‘000s.

Converting bank reward points to miles is usually a good way to increase their cash value by 40-180%, even if you use the miles inefficiently.

The benefit is a lot higher if you are willing or able to use the miles more efficiently, which can nearly double their value again.

How we compared

Credit card rewards program are confusing. Each program has its own way of awarding points and redeeming rewards. There are minimums to meet and caps to avoid. There are different promotions that vary awards by the category you spend on.

And of course all banks have their own reward points that are difficult to compare.

Value of a Reward Point

Our first step to cut through this mess was to calculate an exchange rate for each point program – the value in SG$, of a single point. We did this by looking at the conversion rate the banks offered for a cash redemption.

For e.g. 100 DBS points convert to S$1 while 3,600 OCBC$ convert to S$10. This means the DBS point is worth 1/100 of a S$ i.e. 1¢ while an OCBC$ is worth 10/3600 of a S$, 0.28¢.

We then looked at how much money you need to spend to get one point. Spending S$5 gets you one DBS point while an OCBC$ is awarded on a 1 for 1 basis.

Putting these together,  we get the effective rebate rate for each program.

For DBS points, you need to spend $500 to get 100 points (100 point * S$5 / point), which converts to a $1 reward or 0.20% rebate rate.

For OCBC$, you need to spend $360 to get $1 in reward, which is effectively a 0.28% rebate rate.

Table 2: Value of a Reward point & effective rebate (%)

Reward Program S$ Spend
per Point
Points to Cash Value
per Point
Rebate =
B / A
DBS Points S$5 100 points = S$1 1.00 cent 0.20%
OCBC$ S$1 3,600 points = S$1 0.28 cents 0.28%
OCBC Travel$ S$1 100 points = S$1 1.00 cent 1.00%
OCBC Voyage Miles S$1 100 points = S$1 1.00 cent 1.00%
UOB UNI$ S$5 100 points = S$1 1.00 cent 0.20%
Citi Points S$1 440 points = S$1 0.23 cents 0.23%
Citi Miles S$2.50 165 Citi Miles = S$1 0.61 cents 0.24%
HSBC Points S$1 400 points = S$1 0.25 cents 0.31%
SC* 360° Rewards S$1 320 points = S$1 0.31 cents 0.25%
*SC = Standard Chartered

Value of a KrisFlyer Mile

We estimate the value of a KrisFlyer mile to be 1.4¢.

This is based on what we were able to easily get on the Singapore Airlines website i.e. without needing to book far in advance or needing to change our preset travel dates or buying tickets in a higher class that we normally would (Economy). You can read more about our method here.

First we looked at the number of miles needed to buy Apple Products on KrisShop. This is because Apple usually does not discount its products.

Therefore the price of an Apple iPhone 13 Pro Max, 128GB is likely to be the same everywhere, which gives a simple way to calculate the value of a point.

Second we looked at the exchange rate offered by Singapore Airlines under the Pay with KrisFlyer miles option.

Finally, we compared prices and availability of award fares for return flights to 7 destinations on 3 separate dates.

The table below shows a sample of these calculations. You can see that the value of a mile is about 0.8¢ if you purchase something on KrisShop, while paying for flight fares gets you 0.95¢ per mile.

However if you redeem an award ticket (i.e. pay for the whole ticket with only miles), the value of a  mile shoots up to 1.4¢.

This 1.4¢ is estimated based on the values we achieved across 21 return flights and is something we think most people can easily achieve. The actual values for the 21 return flights ranged from 0.93¢ to 2.7¢ depending on the flight and date.

Table 3: Value of a KrisFlyer Mile

Item Price in Miles^
Price in SG$*
Value per Mile =
B / A
Buying an Apple product on KrisShop e.g. Apple iPhone 13 Pro Max, 128GB 210,164 S$1,681 0.8 cent
Part Payment for an Economy Class flight on Singapore Airlines Website 10,000 S$95 0.95 cent
Redeeming an Award Ticket on Singapore Airlines Website 70,000 S$980 1.4 cent
^Quoted price on KrisShop website for Apple products. SQ website for flights.
* excluding GST for Apple Products. Amount by which fare is reduced for part and full payment of tickets.

Putting this together with the conversion rates for bank reward points into miles, we get an estimate for the effective discount rate that you get by converting points into miles for each program.

Table 4: Effective rebate (%) for points converted into miles

Reward Program S$ Spend
/ Point
Miles / Point
Value / point =
1.40¢ / mile x B
Rebate =
C / A
DBS Points S$5 2.0 2.80 cents 0.56%
OCBC$ S$1 0.4 0.56 cents 0.56%
OCBC Travel$ S$1 1.0 1.40 cents 1.40%
OCBC Voyage Miles S$1 1.0 1.40 cents 1.40%
UOB UNI$ S$5 2.0 2.80 cents 0.56%
Citi Points S$1 0.34 0.48 cents 0.48%
Citi Miles S$2.50 0.85 1.19 cents 0.48%
HSBC Points S$1 0.4 0.56 cents 0.56%
SC* 360° Rewards S$1 0.4 0.56 cents 0.56%
*SC = Standard Chartered

As you can see, comparing Table 2 & 4, in most cases the implied discount for miles is higher than that for points. Converting rewards points to miles is the better option in every case and the converted miles are worth 40-180% more than the points at the banks.

Adjusting for Conversion Fee

There are hefty fees for converting rewards points to KrisFlyer miles. HSBC charges S$42.80 (with GST) while every other bank charges S$26.75.

Because of this it only makes sense to convert your points to miles once you cross a certain threshold of points. Any less and you would be better off simply taking the lower cash value at the bank.

The table below shows the minimum number of points you need in order to convert them to miles and still come out ahead after paying the conversion fee.

We computed this by dividing the fees for conversion by the difference between the value of a point at the bank and the value of a point converted to miles.

Table 5: Minimum points to mile conversion, with fees, assuming 1.40¢/mile

Rewards Program Fees for conversion
(incl. GST)
Min. points for a
viable conversion^
Min. spend to
points in (A)
DBS Points S$26.75 2,000 S$10,000
OCBC$ S$26.75 10,000 S$10,000
OCBC Travel$ Free 1 S$1
OCBC VoyageMiles Free 1 S$1
UOB UNI$ S$26.75 2,000 S$10,000
Citi Points S$26.75 11,000 S$11,000
Citi Miles S$26.75 5,000 S$12,500
HSBC Points S$42.80 14,000 S$14,000
SC* 360° Rewards S$26.75 11,000 S$11,000
*SC = Standard Chartered
^ rounded to next highest ‘000s.

Ideally you want to convert a much higher number of points, maybe 2-4x the numbers above to maximize the value from the conversion.

Optimizing value of a KrisFlyer mile

A lot of excellent work has been done by sites like Mainly Miles & The Mile Lion to show you how to maximize the value you get for each mile. They discuss ways to get 2¢, 3¢ or even 7¢ per mile  in value.

They both arrive at a reasonable value of around 1.7-2.0¢ per mile although this was a while ago and we believe the value has come down a bit since.

They also strongly advice against using miles to buy products from KrisShop or to make part payment for economy class fares.

With our revised estimate of the value of a KrisFlyer mile, we agree. It does not make sense to use KrisFlyer miles to shop at KrisShop or to make part payments for flights, unless those miles are about to expire and you have no other way of using them.

In our testing, we found that award flights were quite easily available for most dates and destinations. This may be because travel still hasn’t recovered fully from the pandemic. We will review our analysis in a few months to see if award flights remain easily available.

If you have a large number of miles and / or the flexibility in booking flights needed to optimize conversion or if you just enjoy working to get the best deal, you can also follow the advice of booking early, redeeming Business Class or higher fares and get even better value for your miles.

The great thing is that anything you do to increase the value of your miles will only make the case for converting points to miles stronger. The table below shows the minimum points you should convert assuming that you can get 1.7c per mile.

Table 6: Minimum points to mile conversion, with fees, assuming 1.7¢/mile

Rewards Program Fees for conversion
(incl. GST)
Min. points for a
viable conversion^
Min. spend to
points in (A)
DBS Points S$26.75 2,000 S$10,000
OCBC$ S$26.75 7,000 S$7,000
OCBC Travel$ Free 1 S$1
OCBC VoyageMiles Free 1 S$1
UOB UNI$ S$26.75 2000 S$10,000
HSBC Points S$42.80 10,000 S$10,000
SC* 360° Rewards S$26.75 8,000 S$8,000
*SC = Standard Chartered
^ rounded to next highest ‘000s.

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