American Express opens interest-bearing accounts for individuals

American Express has just presented its first current account offer for individuals. It relies on a 100% digital model and a promise of remuneration to attract its target. An effort to diversify and build loyalty for American Express in the face of heightened competition.

FACTS

• The Amex Rewards Checkin account is the clear name chosen for the new service offered by American Express.

• Its main features are the following ones:

  • an interest-bearing current account,

  • rewards applied to payments made via the attached American Express debit card (1 Membership Rewards point earned for every $2 spent on eligible purchases)

  • zero monthly fees,

  • no minimum balance,

  • 24-hour customer service.

• The service is fully controllable from the American Express application, which allows you to make cheque deposits.

• It is open to current American Express customers who have had an American Express card for at least three months.

ISSUES

• An expected adaptation: In June 2021, American Express announced the deployment of a service called Kabbage Checking, an offer of paid accounts aimed at American small businesses. It was in fact launched by Kabbage just before it was acquired by American Express; the American payment giant has adopted a somewhat renewed concept.

• An effort in terms of loyalty: With its 0.5% annual remuneration, the American Express current account does better than the average offer on the American market.

MARKET PERSPECTIVE

• This positioning of American Express on the current account market illustrates the crossroads that is taking place in the more global and international financial services market. Competition is increasing, driven by various players, led by FinTechs and Gafams.

• Diversification is now an unavoidable means of sustaining its activities. Faced with initiatives such as that of American Express, the historical banks are now seeking to regain control of the payment market.

• In Europe, beyond the EPI fund project, the banks are using acquisitions to illustrate this trend. BNP Paribas has bought Floa to enter the fractional payment market, while La Banque Postale is working with Alma and Crédit Agricole has just bought SFPMEI.

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