American Express has launched a new checking account. The financial services company primarily focuses on credit cards and payments processing but now offers a new checking product for consumers.
The new members-only American Express Rewards Checking will offer debit card rewards plus a high yield on balances compared to other checking accounts.
- American Express has launched its Rewards Checking account that allows users to earn Membership Rewards points with their debit card.
- The high-yield checking account also offers an interest rate that rivals some high-yield savings accounts.
- The digital consumer checking account is only available to existing American Express consumer credit card holders.
American Express Rewards Checking: Everything You Need to Know
The new consumer checking account from American Express combines a high yield with debit card rewards. For starters, account holders will earn 1 Membership Rewards point for every $2 they spend with their debit card.
For those who have a Membership Rewards-earning credit card, points earned with their debit card will be pooled with points earned with their credit card, and they can use them the same way they use their credit card rewards.
If you don't have a Membership Rewards credit card, though, you can only redeem your points for deposits in your checking account at a rate of 0.8 cents per point.
The checking account also offers a 0.50% APY, which is close to what many high-yield savings accounts offer. In contrast, the current average for interest checking accounts in the U.S. is 0.03%, according to the Federal Deposit Insurance Corporation.
The account has no monthly maintenance fee, nor is there a minimum balance requirement, both of which are standard for online checking accounts. You can get free ATM withdrawals from more than 37,000 ATMs in the MoneyPass network.
Finally, the account offers zero-liability fraud protection, as well as purchase protection, which is a standard benefit for credit cards but not debit cards. Purchase protection covers eligible items that you purchase with your American Express Rewards Checking debit card for up to 90 days in the event that they're damaged or stolen. Coverage is limited to $1,000 per claim and $50,000 per account per calendar year.
Should You Open the Amex Rewards Checking Account
Only consumers who have an American Express consumer credit card are eligible to apply to open the Amex Rewards Checking account. With that in mind, it could be worth having if you already have a Membership Rewards-earning credit card, but you also use your debit card regularly and want to maximize your rewards.
That said, if you don't have a Membership Rewards-earning credit card, you're stuck with redeeming your rewards for deposits, giving you an effective 0.4% cash back. In contrast, there are a handful of other rewards checking accounts that offer 1% cash back, giving you more value.
Additionally, there are other online banks that offer high-yield interest checking accounts, so this one isn't unique in that area, either.
But if your goal is to earn as many Membership Rewards points as possible with all of your spending, the account might be worth it for the debit rewards alone.