What is American Express?

The American Express Card, also known as the “American Express” card, is an electronic payment card marketed by the publicly traded financial services company American Express (AXP). Amex issues and processes prepaid debit and credit cards. American Express is available to personal, small business and corporate customers in the United States and around the world.

Central thesis

  • American Express cards are issued by American Express, a publicly traded financial services company, and are charge, credit, or prepaid cards.

  • The American Express card, also known as the “American Express” card, offers a variety of benefits, including bonus points, cash back, and travel benefits. Some cards are co-branded, such as those from Delta and Hilton.

  • American Express is one of the few card issuers with a credit card payment processing network. Visa and Mastercard have settlement networks but do not issue cards.

Learn about American Express

American Express cards are issued by American Express and processed in the American Express network. American Express is one of the few financial services companies in the industry that can both issue and process electronic payment cards. Experiential “Where Can I Use My Credit Card?” Retrieved June 2, 2021.

American Express is a publicly traded company in the financial services industry. It provides lending and web processing services, giving it a wide range of competitors in the industry. Like traditional lenders, it is able to issue lending products in the form of credit cards and credit cards.

American Express has its own processing network that competes with Mastercard (MA) and Visa (V). Its closest competitor is Discover Financial Services (DFS), also a publicly traded financial services company that provides a network of lending and processing services. 3 With multi-product capabilities, American Express generates revenue from interest-bearing products and network processing transaction services.

American Express fees

A large portion of American Express’s revenue comes from transaction processing. Many merchants accept American Express and are willing to pay transaction fees associated with processing because American Express is offered to customers as a payment option.

In an American Express transaction, the merchant’s acquiring bank communicates with American Express as the processor and issuer during the transaction. Acquiring commercial banks must cooperate with American Express’s processing network to transmit communications about American Express transactions. American Express is also the issuer that verifies and approves transactions.

Merchants pay American Express a small fee for processing network services, which is part of the total fee associated with a single transaction. American Express has built a solid reputation in the financial services industry as a processor and premium lender.

Types of American Express Cards

As mentioned above, American Express credit and prepaid debit cards are offered to a wide range of consumer and business customers. It’s also an industry-leading charge card provider, offering loans on credit card balances that need to be repaid each month.

American Express debit and credit cards follow standard signature procedures. The company seeks borrowers with good to high credit quality — meaning a minimum credit rating of 670 – and is generally not a subprime lender.

American Express credit and debit cards offer a variety of benefits in the form of bonus points and travel perks, some of which depend on the annual fee charged. American Express may offer cash back on some purchases, although they’re not one of the best cash back cards available today. American Express also offers various brands of prepaid debit cards that can be used as gift cards or rechargeable payment cards for special purposes.

American Express cards tend to have high annual fees: $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. Said that Green, Gold and Platinum cards do not have a fixed spending limit. American Express offers at least six cards with no annual fee. All American Express cards are highly rated for customer service, company J.D. Power’s 2020 U.S. Credit Card Satisfaction Study.

Partners, co-branded cards

American Express issues many cards directly to consumers, but also has partnerships with other financial institutions. In the US, for example, Wells Fargo issued the American Express card (new applications were suspended in April 2021, although this will not affect existing cardholders), while in Mexico, Santander is offering the American Express card. American Express has also partnered with other companies to encourage consumers to apply for credit cards. Two examples are a co-branded card with Delta Air Lines, which allows consumers to earn frequent flyer miles that can be redeemed at Delta, and a co-branded card with Hilton Hotels.

Pros and Cons of American Express


  • American Express Green, Gold and Platinum cards do not have fixed spending limits.

  • American Express is known for its high-quality customer service, ranking #1 in J.D. Power’s 2020 U.S. Credit Card Satisfaction Study.

  • American Express offers a variety of rewards, perks, and cash back on purchases.

  • You must pay off the balance on your Amex Charge card in full each month so you don’t incur huge interest costs.


  • Some merchants do not accept American Express due to higher transaction fees than other cards.

  • You cannot get an American Express card without good credit (670 or higher).

  • The annual fee for an American Express card can be high.

  • You must pay the balance on your American Express card in full each month, so you can’t “borrow” money with them.


Jake Smith

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Jake Smith

He is the editor of Eragoncred. Previously, he was editor-in-chief of Eragoncred and a financial industry reporter. Jake has spent most of his career as a Digital Media journalist and has over 10 years of experience as a writer and editor.