New Reward Point Rules From July 1: SBI Card Cuts Benefits On PhonePe SELECT Credit Cards

SBI Card has announced significant changes to its co-branded PhonePe SBI Card SELECT BLACK and PhonePe SBI Card PURPLE credit cards, which were launched in partnership with PhonePe last year. The revised rules, communicated recently to cardholders, introduce monthly caps on reward point earnings across various spending categories and expand the list of transactions that will no longer be eligible for rewards.

The changes will come into effect from July 1, 2026, and are expected to impact cardholders who frequently use these cards for online shopping, insurance payments, utility bills, and UPI transactions.

What Is Changing From July 1, 2026?

Under the revised reward structure, SBI Card has lowered the maximum reward points that can be earned each month in certain categories while completely excluding some transactions from reward eligibility.

Changes for PhonePe SBI Card SELECT BLACK

Cardholders will face a reduction in reward point earnings on online transactions and PhonePe-based spends:
•The monthly reward point cap on online spending will be reduced from 2,000 points to 1,000 points.
•Insurance payments made through PhonePe will now have a separate monthly cap of 500 reward points.
•Other eligible transactions conducted via PhonePe will be capped at 1,500 reward points per month.

Changes for PhonePe SBI Card PURPLE

Similar revisions have been introduced for PhonePe SBI Card PURPLE users:
•The monthly reward point cap on online spending will be reduced from 1,000 points to 750 points.
•Insurance payments made through PhonePe will earn a maximum of 250 reward points per month.
•Other eligible PhonePe transactions will be capped at 750 reward points per month.

Transactions That Will No Longer Earn Reward Points

Starting July 1, several categories of spending will become completely ineligible for reward points, regardless of the amount spent. These include:

•Payments made to educational institutions
•Toll and bridge payments
•Jewellery purchases
•Gift cards and gift voucher purchases
•Utility bill payments made outside the PhonePe platform
•Insurance premium payments made outside PhonePe
•UPI transactions conducted through apps other than PhonePe

The exclusions are based on specific Merchant Category Codes (MCCs). These include toll and bridge operators (4784), gift and souvenir shops (5947), jewellery stores (5094 and 5944), educational institutions (8220), utility service providers (4900, 4814 and 4899), insurance merchants (5960, 6300 and 6380), and certain UPI-related transaction categories.

SBI Card clarified that all other benefits, features, and reward point accrual mechanisms associated with the PhonePe SBI Credit Cards will remain unchanged.

Earlier Changes Introduced By SBI Card

The latest revision follows a series of changes introduced by SBI Card earlier this year for most of its credit card portfolio, excluding PhonePe SBI Card PURPLE and PhonePe SBI Card SELECT BLACK.

With effect from April 1, 2026, SBI Card capped the redemption of reward points for statement credit at 60,000 reward points per card per calendar month. The cap applies to all SBI credit cards where reward points can be redeemed against statement balances. The company also revised the redemption structure for select credit cards. Under the new rules, statement credit redemption can only be made in multiples of 4,000 reward points.