The American Express Company was formed in 1850 in New York and has since then established itself worldwide as a powerful and influential issuer of credit and charge cards.
American Express credit cards are in essence prestige reward credit cards. The interest rates are high, application approval is relatively tough and fees are potentially high.
On the other hand, the reward programs are highly flexible and generous. American Express cards offer complimentary enrolment into their reward program 'Membership Rewards'. While they have different reward programs, MR is their staple broad program. 'Membership Rewards' features:
- No Reward Point Capping - Most reward credit cards have an annual cap on the amount of reward points you can earn, generally ranging from 50,000 for lower-end cards up to 150,000 for gold and platinum cards. Amex offers unlimited point opportunities.
- No Reward Point Expiry - As long as your account remains open, Membership Reward points will not expire.
- High Reward Point Conversion - You won't find an American Express credit card that offers less than 1 reward point per $1 spent. Some credit cards along with introductory promotions can raise the conversion rate to 2 points earned per dollar.
American Express Credit Card Offer
The Qantas American Express Discovery Card features $0 annual fee. Earn 1 Qantas Frequent Flyer point per $1 spent on all your purchases.
- $0 p.a. annual fee
- 20.74% p.a. on purchases
- 0% p.a. for 12 months with 1% balance transfer fee on balance transfers
- Up to 44 days interest free
- Minimum Income Requirement of $35,000 p.a.
Why is American Express not as popular as Visa or Mastercard in Australia?
The key reason is acceptance. Visa and Mastercard have practically worldwide acceptance anywhere where credit cards are accepted, while Amex access is more limited.
User feedback on Credit Card Finder® frequently points out the frustration of Amex's limited acceptance in Australia.
This is due to the fact that American Express charges more to the retailer per transaction than Visa or Mastercard. This extra cost is not paid for by consumers*, which gives Amex the opportunity to compensate for their customers instead with more rewards.
*Retailers can incur surcharges on credit card purchases, and if American Express is accepted at all, it will likely be at a higher surcharge than Visa or Mastercard.
What type of people would American Express credit cards be suited for?
Like any reward program credit card, you need to ensure you hardly ever, if ever pay interest on your balance and spend enough on your card per year to offset the fees on your card.
If you currently aren't or won't be doing both of these, you will be paying more in interest and fees than you'll be receiving in redeemed rewards. American Express credit cards are most suited for those who:
- Have Good Credit and Annual Income
American Express state themselves in the application prerequisites that 'Good credit' and a 'Minimum annual earnings of $40,000+' apply. $40,000 is on the lower end of the range.
- Spend a lot
Whether you're a high income earner or go out of your way to maximise the amount of times you use your Amex for a purchase or payment, the value of rewards can be significantly appealing.
- Travel a lot
One of the key features of Membership Rewards are the discounted and free flight opportunities. Not only this, card holders have access to concierge service, travel insurance and purchase security whilst overseas.
- Business Owners
Purchasing capital and equipment on credit is a popular method for business owners to hike up reward points, though as mentioned previously acceptance of American Express in Australia can be a frustrating issue.
For prestigious and generous reward programs which aren't licensed under Amex, see the Gold and Platinum Visa and Mastercard reward cards.
Learn more and compare Platinum, Gold and Black Credit Cards here