A small business charge card, designed for companies that need flexibility in managing monthly payments.
30-second take
- Get this card if you want flexibility in managing your monthly expenses.
- Pick something else if you want travel rewards or cashback rewards.
- Apply with a good to excellent credit score of 670 or higher.
Pay early and get a 1.5% discount.
Whenever you pay within 10 days of the closing date, you get a 1.5% discount on your payment. Consider this like getting 1.5% cash back as a statement credit.
Pay later with no interest.
Most business cards give you a grace period of 25 days to pay your balance, whereas The Plum Card® from American Express gives you a 60-day grace period as long as you pay at least 10% of your balance by the payment due date. At first, this may not seem like a perk worth paying $250 a year for, but keep in mind that most business cards have a variable APR of 12% to 22% on purchases after the 25-day grace period. If you find it hard to pay your balance on time, you’ll save more money avoiding the APR on other cards than the annual fee you’ll have to pay for The Plum Card® from American Express.
No preset spending limit.
American Express gives you increased purchasing power that adjusts with your card use, your payment history, your credit record and other factors determined by the bank.
0% foreign transaction fees.
You can freely use this card when traveling abroad, as it has 0% international transaction fees.
Choose your billing cycle.
American Express gives you the option to choose your own billing cycle, which can be at the beginning, middle or end of the month.
Get additional cards with no annual fee.
You pay a $250 annual fee only for the first card — and it’s waived the first year. Every additional card has no annual fee.
Travel, baggage and rental car insurance.
Reservations paid entirely with this card gains you automatic insurance up to $100,000 for accidental death and dismemberment coverage while traveling. Your baggage is insured up to $1,250 for carry-on items and up to $500 for checked baggage, and you’re insured for car loss and damage when you rent a car.
Roadside and global assistance hotlines.
When you’re stranded on the road, you can call the roadside assistance hotline for help changing a flat, jumping your battery and more. For trips more than 100 miles from home, you have 24/7 access to medical, legal, financial and other emergency services you may need by calling the Global Assist® Hotline. Keep in mind that third-party service costs are your responsibility.
Online expense management tools.
With this card, you have access to mobile banking where you can set up automatic payments and alerts, monitor your employee spending or connect with your QuickBooks account to transfer your transaction data.
High annual fee.
The Plum Card® from American Express entails a $250 annual fee, which is waived for the first year. This is relatively high, but if your business has a hard time collecting cash, the longer grace period can save you more in APR costs than the annual fee of the card.No cashback rewards.
The Plum Card® from American Express is designed to help you pay your balance at a later date without paying a high APR. If you pay your balance within 25 days, you may want to look for a card that will also give you cash back or reward points.Not a credit card.
This is a charge card, which means you have to pay your entire balance in full before its due date.
You want travel rewards and you don’t want to pay annual fees.
A decent option for a travel rewards card without annual fees could be the Business Advantage Travel Rewards World Mastercard® credit card by Bank of America, which lets you earn 3 points per dollar when you book through the Bank of America Travel Center and 1.5 points per dollar on all other purchases. You can redeem these points to pay for flights, hotels, car rentals, cruises, vacation packages and baggage fees, or you can redeem them for gift cards and cash back.
You travel often and you’re loyal to a brand of hotels.
Depending on which hotels you frequently stay at, you may consider the Starwood Preferred Guest® Business Credit Card from American Express, the Marriott Rewards® Premier Business credit card by Chase or the Hilton Honors American Express Business Credit Card. All of these cards let you earn points you can redeem for free hotel stays and other features.
You want cashback rewards.
If your business spends thousands of dollars on gas and office supplies and you want cash back for all purchases, the Business Advantage Cash Rewards Mastercard® credit card by Bank of America could be a better choice. It offers 3% cash back on gas and office supplies up to $250,000 per year — then 1% after that, 2% cash back at restaurants and 1% on all other purchases.
If you want an American Express card with similar perks, the SimplyCash® Plus Business Credit Card from American Express could be a good alternative. It offers 5% cash back at US office supply stores and on wireless telephone services purchased directly from US service providers, 3% on a category of your choice and 1% on everything else. The 5% and 3% cashback rewards have a yearly cap of $50,000 — after that, 1% cash back applies.
- Business name and address
- Industry type
- Company structure
- Years in business
- Number of employees
- Annual revenue and monthly spending
- Federal Tax ID, also known as Employment Identification Number (EIN)
- Personal information of the card owner, including annual income
- Use the online management tools. American Express offers online tools that can help you set up autopay and account alerts to avoid late payments and to notify you of suspicious activity. You can also manage your expenses by using the Spend ManagerSM feature and can transfer your data directly to your QuickBooks account.
- Contact customer service. For questions, call the 24/7 customer service line at 1-800-528-4800 or use the online chat feature.
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| Product Name | The Plum Card® from American Express |
|---|---|
| Card Type | American Express |
| Annual Fee | $0 annual fee for the first year ($250 thereafter) |
| Foreign Transaction Fee | None |
| Interest Free Period | Up to 60 days |
| Minimum Interest | $0 |
| Late Payment Fee | $38 |
| Returned Payment Fee | $38 |
| Additional Cardholder Fee | $0 |
| Minimum Age | 18 years of age |
|---|
The basics
The Plum Card® from American Express is a charge card, which means you have to pay your balance in full before its due date. Unlike most other cards that have a grace period of 25 days before the APR kicks in, The Plum Card® from American Express gives you a 60-day grace period if you pay at least 10% of your balance.If you pay your bill within 10 days of the closing date, you’ll get an early pay discount of 1.5%. In a way, you can look at this discount as a cashback reward.
The perks
How does The Plum Card® from American Express early pay discount work?
Let’s say that your monthly expenses are $20,000, and you pay the entire amount within 10 days of your closing date. The 1.5% discount you earn in statement credit is $300. If you pay your balance within 10 days for the entire year, you’ll get $3,600 in statement credit as a discount.
How does The Plum Card® from American Express’s 60-day grace period work?
Suppose you have a $20,000 balance for the first month. You have 30 days to pay 10% of the balance, or $2,000, by the payment due date to be able to carry the rest of your balance of $18,000 for the next 30 days — for a total of 60 days grace period.
On the second month you spend an additional $20,000, so your new balance is what’s spent plus the $18,000 from the first month — for a total of $38,000. Now you would have to pay the first month’s $18,000 plus 10% of the second month’s balance to be able to carry the remaining $18,000 of the second month over to the third month, and so on.
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What size business is The Plum Card® from American Express good for?
This could be a good card for small businesses that struggle with cash flow and need more time to pay the balance on their card. Unlike other business cards, where the grace period is 25 days, The Plum Card® from American Express gives you a 60-day grace period as long as you pay at least 10% of your balance by the payment due date.
What should I know before I apply?
When you apply for The Plum Card® from American Express, you’ll have to provide information about yourself and your business, including:
What credit score do I need?
You need a good business credit score of 670 or higher to apply for The Plum Card® from American Express.
What’s my likelihood of being approved?
Businesses that have a credit score of 670 or higher are most likely to be approved.
What do customers say about The Plum Card® from American Express?
Customers like the deferred payment option and the 1.5% discount on early payments. They also like the increase in spending limit they get the more they use the card.
American Express is accredited by the Better Business Bureau (BBB) and has an A+ rating. Based on more than 170 customer reviews, the company has earned a composite score of 3.78 out of 5 stars. However, as of May 2018, there are almost 3,000 customer complaints that center on poor customer service. Others report issues with missing statement credit and miles, having their card unexpectedly canceled and problems logging in to their online account.
How to apply for The Plum Card® from American Express?
1. Go to the American Express website.
2. Select The Plum Card® from American Express from the list and click Apply.
3. Complete the application form with all the required information about your business and the employee who will receive the card.
4. Review your application and submit it.
How long will it take to be approved?
American Express instantly approves your application if you meet the criteria and the information you provided is accurate and complete. Upon approval, you’ll receive the card in three to four business days via UPS.
I got the card. Now what?
Bottom line
The Plum Card® from American Express could be a great card for your business if you struggle with cash flow. With this card, you can pay your balance in 60 days if you pay at least 10% of it by the payment due date. Plus, you get a 1.5% discount for every payment you make 10 days before the closing date.At first glance, the only setback this card has is the annual fee of $2506, which is waived for the first year. But if you take into account that it lets you delay your payments without paying an APR, which can cost anywhere from 12% to 22% variable, then the money you save may outweigh the annual fee.
Before you apply, consider other options with our comprehensive guide to business credit cards to find the right one for you.
Frequently asked questions
Image: americanexpress.com
