DEFINITION of 'American Express Card'

A credit, charge or prepaid card branded by American Express Company, a major payment card and travel services company. American Express cards, also called Amex cards, are available to individuals, small businesses and corporate consumers in the United States and around the world. Unlike MasterCard and Visa, American Express does not issue debit cards.

BREAKING DOWN 'American Express Card'

American Express offers a variety of cards to serve different consumer groups. An American Express credit card for individual consumers with excellent credit might offer rewards points, flexible repayment terms and a low interest rate, for example, whereas a reloadable prepaid card that must be funded before it can be used might be appropriate for a consumer who has bad credit.

American Express issues many of its cards directly to consumers, but it also has partnerships with other financial institutions. In the United States, for example, The Bank of America issues some American Express cards and Banco Santander offers American Express cards in Mexico. American Express also has partnerships with other companies to encourage consumers to apply for its credit cards. An example is its co-branded card with Delta Airlines, which allows consumers to earn frequent flier miles redeemable on Delta.

American Express cards, like other payment cards, let consumers and businesses exchange payments in person, online or by phone. The merchants that accept American Express cards pay Amex a small percentage of the amount of each transaction. Many businesses find it worthwhile to pay these credit card processing fees because their acceptance of American Express cards helps them increase sales by making purchasing safer and more convenient for consumers. In addition, American Express assumes the risk that the customer will not pay their bill in full. The merchant gets paid when the card transaction is completed.

At the end of 2013, American Express had more than 50 million card members in the United States and more than 107 million worldwide. American Express cards are accepted by businesses in more than 130 countries.

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