diff --git a/CHANGELOG.md b/CHANGELOG.md
index dc7902b7..3a053e6d 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -28,6 +28,12 @@ Contains bug fixes.
 Contains all the PRs that improved the code without changing the behaviours. 
 -->
 
+## [Unreleased]
+
+### Fixed
+
+- [#414](https://github.com/archway-network/archway/pull/414) - Preventing user from setting contract flat fee if rewards address is not set 
+
 ## [v1.0.1]
 
 - [#411](https://github.com/archway-network/archway/pull/411) - Update repository readme with correct docker containers.
diff --git a/x/rewards/keeper/flat_fee.go b/x/rewards/keeper/flat_fee.go
index b193094d..b44a28bc 100644
--- a/x/rewards/keeper/flat_fee.go
+++ b/x/rewards/keeper/flat_fee.go
@@ -21,6 +21,9 @@ func (k Keeper) SetFlatFee(ctx sdk.Context, senderAddr sdk.AccAddress, feeUpdate
 	if feeUpdate.FlatFee.Amount.IsZero() {
 		k.state.FlatFee(ctx).RemoveFee(feeUpdate.MustGetContractAddress())
 	} else {
+		if contractInfo.RewardsAddress == "" {
+			return sdkErrors.Wrap(types.ErrMetadataNotFound, "flat_fee can only be when rewards address has been configured")
+		}
 		k.state.FlatFee(ctx).SetFee(feeUpdate.MustGetContractAddress(), feeUpdate.FlatFee)
 	}
 
diff --git a/x/rewards/keeper/flat_fee_test.go b/x/rewards/keeper/flat_fee_test.go
index 8c5e3b79..256ddfd5 100644
--- a/x/rewards/keeper/flat_fee_test.go
+++ b/x/rewards/keeper/flat_fee_test.go
@@ -31,6 +31,17 @@ func (s *KeeperTestSuite) TestSetFlatFee() {
 	metaCurrent.OwnerAddress = contractAdminAcc.Address.String()
 	_ = keeper.SetContractMetadata(ctx, contractAdminAcc.Address, contractAddr, metaCurrent)
 
+	s.Run("Fail: rewards address not set", func() {
+		err := keeper.SetFlatFee(ctx, contractAdminAcc.Address, rewardsTypes.FlatFee{
+			ContractAddress: contractAddr.String(),
+			FlatFee:         fee,
+		})
+		s.Assert().ErrorIs(err, rewardsTypes.ErrMetadataNotFound)
+	})
+
+	metaCurrent.RewardsAddress = contractAdminAcc.Address.String()
+	_ = keeper.SetContractMetadata(ctx, contractAdminAcc.Address, contractAddr, metaCurrent)
+
 	s.Run("OK: set flat fee", func() {
 		err := keeper.SetFlatFee(ctx, contractAdminAcc.Address, rewardsTypes.FlatFee{
 			ContractAddress: contractAddr.String(),
diff --git a/x/rewards/keeper/grpc_query_test.go b/x/rewards/keeper/grpc_query_test.go
index 14750353..3b595b17 100644
--- a/x/rewards/keeper/grpc_query_test.go
+++ b/x/rewards/keeper/grpc_query_test.go
@@ -154,6 +154,7 @@ func (s *KeeperTestSuite) TestGRPC_EstimateTxFees() {
 		err := k.SetContractMetadata(ctx, contractAdminAcc.Address, contractAddr, rewardsTypes.ContractMetadata{
 			ContractAddress: contractAddr.String(),
 			OwnerAddress:    contractAdminAcc.Address.String(),
+			RewardsAddress:  contractAdminAcc.Address.String(),
 		})
 		s.Require().NoError(err)
 		err = k.SetFlatFee(ctx, contractAdminAcc.Address, types.FlatFee{
@@ -170,7 +171,7 @@ func (s *KeeperTestSuite) TestGRPC_EstimateTxFees() {
 		s.Require().EqualValues(minConsFee.Amount, fees.AmountOf("stake"))
 	})
 
-	s.Run("ok: gets estimated tx fees inclulding contract flat fee(same denom)", func() {
+	s.Run("ok: gets estimated tx fees including contract flat fee(same denom)", func() {
 		expectedFlatFee := sdk.NewInt64Coin("stake", 123)
 		contractAdminAcc := s.chain.GetAccount(0)
 		contractViewer := testutils.NewMockContractViewer()
@@ -180,6 +181,7 @@ func (s *KeeperTestSuite) TestGRPC_EstimateTxFees() {
 		err := k.SetContractMetadata(ctx, contractAdminAcc.Address, contractAddr, rewardsTypes.ContractMetadata{
 			ContractAddress: contractAddr.String(),
 			OwnerAddress:    contractAdminAcc.Address.String(),
+			RewardsAddress:  contractAdminAcc.Address.String(),
 		})
 		s.Require().NoError(err)
 		err = k.SetFlatFee(ctx, contractAdminAcc.Address, types.FlatFee{
@@ -289,6 +291,7 @@ func (s *KeeperTestSuite) TestGRPC_FlatFee() {
 		err := k.SetContractMetadata(ctx, contractAdminAcc.Address, contractAddr, rewardsTypes.ContractMetadata{
 			ContractAddress: contractAddr.String(),
 			OwnerAddress:    contractAdminAcc.Address.String(),
+			RewardsAddress:  contractAdminAcc.Address.String(),
 		})
 		s.Require().NoError(err)
 		err = k.SetFlatFee(ctx, contractAdminAcc.Address, types.FlatFee{