What Is an American Express Card?
An American Express card, also known as an “Amex” card, is an electronic payment card branded by the American Express. The company issues and processes prepaid, charge, and credit cards. Cards from American Express are accessible to individuals, small businesses, and corporate consumers in the United States and internationally.
Understanding American Express Cards
Cards issued by American Express are processed on the American Express network. This capability is possible because American Express is one of the few companies in the financial service industry that issues electronic payment cards.
American Express is a publicly traded company in the financial services industry that offers credit lending and network processing services, giving it a broad range of competitors in the industry. It can issue credit products like charge cards and credit cards, just like traditional lenders.
Its most comparable competitor is Discover Financial Services (DFS), a publicly traded financial service company offering both credit lending and a processing service network. American Express’s processing network competes with Mastercard (MA) and Visa (V).
American Express generates revenue from interest-earning products and network processing transaction services thanks to its multiproduct capabilities.
American Express Fees
Many merchants accept American Express cards because of the advantages that come with offering American Express as a payment option to customers, which generates a significant portion of American Express’s revenue from transaction processing.
The merchant’s acquiring bank communicates with American Express as both the processor and the issuing bank in the transaction process. The issuer that authenticates and approves the transaction is also American Express.
American Express has built a strong reputation in the financial services industry as both a processor and high-quality lender. Part of the comprehensive fees involved with a single transaction, merchants pay a small fee to American Express for its processing network services.
Types of American Express Cards
It is also an industry-leading charge card provider, which offers month-to-month credit with card balances that must be paid off each month.
This is in addition to American Express credit cards and prepaid debit cards being offered to a variety of retail and commercial customers.
The company seeks borrowers with a credit score of at least 670 and is not a subprime lender.
The benefits that American Express credit and charge cardholders receive, such as rewards points and travel perks, are partially determined by the annual fee.
Though American Express cards may offer cash back on certain purchases, they aren’t currently among the best options available.
American Express also offers numerous branded prepaid debit cards which can be used as gift cards or special-purpose reloadable payment cards.
$95 for the Blue Cash Preferred Card, $99 for the Delta SkyMiles Gold American Express Card, $150 for the Green Card, $250 for the Gold Card, and $550 for the Platinum Card are the annual fees for American Express cards which tend to run high.
Despite this, the Green, Gold, and Platinum cards have no predetermined spending limits.
At least six American Express cards have no annual fee.
Power’s 2019 U.S. Credit Card Satisfaction Study
Amex cards have great customer service, with the company coming in No. 1 on J.D. Power’s 2019 U.S. Credit Card Satisfaction Study. The Power 2020 U.S. Credit Card Satisfaction Study.
Partnerships, co-branded cards
In the U.S., American Express has a partnership with Wells Fargo, and in Mexico, it has a partnership with Banco Santander.
American Express has partnerships with other companies, such as Delta Air Lines and Hilton Hotels, to encourage consumers to apply for its co-branded credit cards. These cards offer perks such as frequent flier miles or Hilton Honors points.