At the Microsoft event at E3, the Xbox team announced something that we knew was going to happen for a while now: the change from Microsoft Points to real-world currency. This week, Microsoft added an entire FAQ dedicated to the change and how it will affect you. To start, here's what's going to go down in the near future:
We are excited to announce that, as part of the next Xbox 360 system update, Microsoft Points will be retired, and transactions on Xbox will take place using your local currency instead of Microsoft Points. The monetary value in your Microsoft account will be stored in local currency, offering you a new, convenient way to purchase exciting Xbox content. This change allows you to use a single Microsoft account to purchase games, movies, apps, and entertainment from your favorite Xbox stores - or the Windows Phone Store for users with a Windows Phone 8!
This change will affect you if you're in Argentina, France, Mexico, Spain, Australia, Germany, Netherlands, Sweden, Austria, Greece, New Zealand, Switzerland, Belgium, Hong Kong SAR, Norway, Taiwan, Brazil, Hungary, Poland, Turkey, Canada, India, Portugal, United Arab Emirates, Chile, Ireland, Russia, United Kingdom, Colombia, Israel, Saudi Arabia, Czech Republic, Italy, Singapore, Denmark, Japan, Slovakia, Finland, Korea, South Africa or the US. Moving forward, you will be able to add your real-world money directly to your Microsoft Account using PayPal or your debit or credit card.
You will also be able to buy Xbox Gift Cards instead of Microsoft Point cards to add funds. You will still be able to use and redeem Microsoft Point cards in the meantime, and Xbox will "add to your account an amount of currency equal to or greater than the Marketplace value of your Microsoft Points, and your Microsoft Points will be retired." You should note, however, that you will have one year to use any Microsoft Points added to your account, as they will expire at that point. Any existing points will be converted to real-world money, too, and that currency will expire on June 1st, 2015, so be sure to spend your bankroll before then. However any actual money added to your account, at any time, will not expire during or after the transition. And just like Steam, Origin and other online currency systems, once you put money in, you won't be able to extract it back out to your real-life wallet. You also will not be able to transfer currency from one Microsoft account to another nor will you be able to purchase Xbox Live Gold Membership with your in-account currency "at this time."
Unfortunately, Xbox Live Rewards will be affected by this change as well.
Microsoft Points that you've earned through Xbox Live Rewards will remain in your Xbox Live account and will transition to your local currency with the rest of your Microsoft Points. Prior to the transition, all your earned Pending Points will be added to your account. Any Microsoft Points you received as part of Xbox Live Rewards, promotions, or contests will retain their same expiration dates after your account transitions. Be sure to stay up to date with all the latest Xbox Live Rewards news at Xbox LIVE Rewards or by following @XboxLIVErewards on Twitter.
Of course, this is just the starting point for the complete transition and more details will be coming in the future, but at least Microsoft is preparing you well ahead of their full changeover in June of 2015. This move will allow for other countries to finally have a more equal playing field, as Microsoft Points sometimes would be over or undervalued depending on where someone lived, and it wasn't fair to the gamer.