American Express escalates high-fee card competition
American Express Co will begin to offer this month US$200 a year in Uber rides, plus other new perks, on its Platinum charge cards as it fights to protect its high-end market from JPMorgan Chase & Co and Citigroup Inc.
The new Platinum benefits by American Express will include richer credits for spending, access to more airport lounges, special dining and entertainment options and free use by family members of an American Express Gold card, according to Janey Whiteside, general manager of Global Charge Products, Benefits & Services for American Express.
The changes, which will start on March 30, will also raise the annual account fee for card holders to US$550 from US$450.
Both JPMorgan and Citigroup, which has a US$450-per-year Prestige card with its own mix of spending credits and perks, are using cards to try to eat away at American Express profit margins, which have long been higher than their own. The banks have also acted because banking regulations imposed after the financial crisis generally favor investing in card businesses over capital markets.
In August, JPMorgan stirred up the high-end card market when it introduced its US$450-per-year Chase Sapphire Reserve card with an initial sign-up bonus worth as much as US$1,500, plus US$300 in annual travel credits and high credits for spending.
The bank started making the cards out of metal to give them a luxurious feel.
American Express will now start using metal for its Platinum cards. Since 1999 it has been using metal for its Centurion card which carries an annual fee of US$2,500 on top of an initiation fee of US$7,500.
The new Platinum benefits include up to US$200 of payments for Uber rides within the United States. The card already offers US$200 in annual credits for airline fees.
The increased competition has been a boon to websites such as NerdWallet.com and ThePointsGuy.com, which compare card costs and benefits from a consumer viewpoint.
American Express began working on the changes in the Platinum card before JPMorgan brought out its Sapphire Reserve card, Whiteside said in an interview on Wednesday.
“This is a response to listening to our customers,” she said. “We are always looking at ways to bring value to our card members.” -Nampa/Reuters
The changes, which will start on March 30, will also raise the annual account fee for card holders to US$550 from US$450.
Both JPMorgan and Citigroup, which has a US$450-per-year Prestige card with its own mix of spending credits and perks, are using cards to try to eat away at American Express profit margins, which have long been higher than their own. The banks have also acted because banking regulations imposed after the financial crisis generally favor investing in card businesses over capital markets.
In August, JPMorgan stirred up the high-end card market when it introduced its US$450-per-year Chase Sapphire Reserve card with an initial sign-up bonus worth as much as US$1,500, plus US$300 in annual travel credits and high credits for spending.
The bank started making the cards out of metal to give them a luxurious feel.
American Express will now start using metal for its Platinum cards. Since 1999 it has been using metal for its Centurion card which carries an annual fee of US$2,500 on top of an initiation fee of US$7,500.
The new Platinum benefits include up to US$200 of payments for Uber rides within the United States. The card already offers US$200 in annual credits for airline fees.
The increased competition has been a boon to websites such as NerdWallet.com and ThePointsGuy.com, which compare card costs and benefits from a consumer viewpoint.
American Express began working on the changes in the Platinum card before JPMorgan brought out its Sapphire Reserve card, Whiteside said in an interview on Wednesday.
“This is a response to listening to our customers,” she said. “We are always looking at ways to bring value to our card members.” -Nampa/Reuters
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