The Plum Card® from American Express offers unique repayment terms and rewards for small businesses. We cover the details, including fees, in our Plum Card review.
The Plum Card® from American Express is a charge card designed with small business owners in mind. You can also make it available to your employees. It comes with specific benefits for small businesses, including the usual extensive list of features American Express is well known for.
American Express OPEN
American Express OPEN is the business card division of the American Express Company. It caters to small businesses by offering them this card with its significant benefits. The benefits include higher-than-normal rewards and membership points, early payment discounts, billing cycle flexibility, and a host of other benefits.
American Express is one of the largest financial services companies in the world, but it’s best known for its business-oriented credit cards. American Express OPEN has supported small business owners in more than $200 billion in purchases in 2017. The company had more than $32 billion in total revenue in 2016. Based in New York City, the company was founded all the way back in 1850.
How The Plum Card® from American Express Works
Plum Card® from American Express works differently than other rewards cards because it’s actually a charge card. This means you are required to pay off the balance in full each month, or American Express will charge a late fee. If your account is 30 days or more past due, you’ll be charged a late fee of the greater of 1.5% of the past due balance, or $38. If the past due balance is $10,000, the late fee will be $150. That’s a steep late fee compared to any other credit card.
However, it also lets you earn rewards in a unique way. If you pay off the balance within ten days of your statement closing date, you’ll get 1.5% off your balance. That’s like getting 1.5% cash back on a more typical credit card.
The “OPEN” part of Plum Card from American Express relates to the fact that the card has no preset spending limits.
As a small business card, it lets you track and monitor your expenses through Quickbooks. It also has an online bonus mall where you can get a 5% discount or bonus membership rewards points from major companies partnered with American Express. These include Hertz, FedEx, Hyatt, and Hewlett-Packard, among others.
- Learn more about this card HERE
Plum Card® from American Express Features and Benefits
As you might expect from a card issued by American Express, Plum Card® from American Express comes with plenty of member benefits.
Credit Limit. As noted above, Plum Card® from American Express has no preset spending limit. However, they’re careful to point out that “No Preset Spending Limit does not mean unlimited spending.” American Express adjusts your purchasing power based on the following factors:
- Your use of the card
- Your payment history
- Your credit record
- The financial resources you disclose to them
- Other factors (which they do not disclose)
Choose Your Billing Cycle. You can choose to receive your bill at the beginning, middle, or end of the month.
Employee Cards. You can offer these to your employees for their own company-related business expenses. It will also let you track and monitor their spending. Employee cards are available at no additional annual fee. The Early Pay Discount also applies to employees’ spending on their cards.
Car Rental Loss and Damage Insurance. If you use a rental car and charge the transaction on your Plum Card® from American Express, you can decline the collision damage waiver. As it is typical with car rental insurance arrangements, you must be covered by primary auto insurance that will pay most of the cost of damage or loss of the vehicle, plus personal liability. But the Car Rental Loss and Damage Insurance will cover the deductible portion. This benefit is available only on eligible rental cars and is not available in Australia, Italy, or New Zealand.
Premium Roadside Assistance. Should you experience a breakdown or a blown tire, this service is available to you with a phone call. They will pay for emergency services up to four times per year, even if one of them is in your driveway. They will also get you a tow of up to 10 miles.
Baggage Insurance Plan. This benefit will reimburse you for eligible lost, damaged, or stolen baggage. In order to qualify, you must have purchases all your travel on the card for a common carrier ticket. American Express provides coverage for up to $1,250 for carry-on baggage and up to $500 for checked baggage.
Global Assist Hotline. If you travel more than 100 miles from home, the hotline will provide you with medical, legal, financial, or other select emergency coordination and assistance services. The service is available on a 24/7 basis and includes:
- Medical and legal referrals
- Assistance with cash wires
- Passport replacement
- Missing luggage
- Other services
Travel Accident Insurance. This coverage is available for $100,000 for accidental death and dismemberment coverage while you are traveling on a common carrier. Once again, you must charge the entire fare on your Plum Card® from American Express.
Extended Warranty. You’ll be able to extend the original manufacturer’s warranty for up to one additional year on purchases made with the card. Purchases must be made in the U.S., and the benefit applies to warranties of five years or less.
Purchase Protection. If you charge a purchase on your card, your card benefits can protect it from accidental damage or theft for up to 90 days from the moment you buy it.
Amex Offers. American Express provides special offers for shopping, dining, travel, and more. As a member of the American Express family, you will have access to those special offers.
Dispute Resolution. American Express will work with you to resolve a transaction involving fraudulent or incorrect charges for purchases made on your card. In my experience, American Express is one of the better companies when it comes to dispute resolution. They once got me a full refund on a bogus travel offer.
Plum Card® from American Express Business Benefits
Plum Card® from American Express comes with a number of user benefits unique to business owners, including:
- Open Forum. This is an opportunity to share your ideas and get information and resources for growing your business from other business owners and industry experts.
- Mobile and Tablet Apps. You can manage your Plum Card® from American Express from your mobile device or tablet. And from there, you can manage your account, pay your bill, check your account balance, or research your account benefits.
- Year-End Summary. American Express provides an online year-end summary of your account activity. The summary is available in January and covers all transactions from January 1 through December 31 of the previous year. This is an important benefit for the preparation of year-end financial statements as well as your business and personal income returns.
- Connect with Quickbooks. The Plum Card can directly transfer your labeled transactions from the card to your Quickbooks account.
- Spend Manager. This feature lets you add receipts and notes to your transactions. You can do this either on your desktop or on your mobile device.
- Account Manager. You can designate a trusted individual to access and manage your business card account while you’re busy with other activities.
- Account Alerts. You can set account alerts to let you know when payment dates are coming up, to monitor employee card spending, or to make you aware of the irregular activity.
Plum Card® from American Express Fees
- Annual Fee. Plum Card® from American Express comes with a $250 annual fee, which is waived for the first year.
- Payments. You have the option to pay your balance in full each month or to carry the balance with no interest for up to 60 days. If you do pay early, you get a 1.5% early payment discount. There is no ceiling on the amount of that discount.
- No Foreign Transaction Fees. Some credit cards and payment processing systems charge a separate fee or a higher fee for international transactions. With Plum Card® from American Express you can make international purchases for your business without worrying about additional fees.
Plum Card® from American Express Pros and Cons
- No preset spending limit.
- A 1.5% discount on your balance, if paid in full within 10 days.
- No interest charges.
- No annual fee in the first year.
- There’s no limit on rewards benefits.
- Integrate the card with Quickbooks with the push of a button.
- Several valuable travel-related benefits.
- Employee cards that let you provide charge cards to select employees.
- No foreign transaction fees.
- Plum Card® from American Express is a charge card, not a credit card. You won’t be able to carry balances. All balances must be paid no later than 60 days from the billing date.
- High annual fee at $250.
- Late fees are prohibitive, at 1.5% of the past due balance.
Should You Open Plum Card® from American Express?
The business benefits of the Plum Card® from American Express are undeniable. The ability to monitor and track expenses on an ongoing basis, as well as the year-end summary, can save a small business significant money on bookkeeping and accounting fees. There’s also the integration with Quickbooks. Your accountant will love you for that. All of this tracking ability will make tax preparation much more simple.
Unlimited rewards, and the ability to get a 1.5% discount for paying your balance within 10 days are the biggest benefits of this card.
But this isn’t necessarily a card for all businesses. First, it’s a charge card, not a credit card. That means you must pay the entire balance each cycle. You will not be able to carry a balance, and that could prove to be a problem with cash flow, especially if you’re looking for a way to spread the cost of a big-ticket purchase over several months.
Plum Card® from American Express will work best for businesses that have a high and predictable cash flow and can easily accommodate immediate balance payments. It will not work for businesses that are looking for a cash flow management tool. Nor will it work for businesses that have low or irregular revenue streams.
But if you do have a strong cash flow and you’re looking for a large number of benefits that can put money in your pocket, check out the Plum Card. American Express has a long history and well-deserved reputation of providing outstanding business cards, particularly with important travel benefits.
- Learn more about this and other small business credit cards