Amex says ‘business cards must now only be used for business expenditure’
Links on Head for Points may support the site by paying a commission. See here for all partner links.
The repercussions from the EU changes to interchange fees on credit and charge cards continue to filter through the market.
One way a card issuer can circumvent the 0.3% cap on fees is to issue ‘business’ cards as these are not capped. The reason for this was quoted on ft.com yesterday in an article about Curve:
Mastercard stated:
We are supportive of the exclusion of commercial cards from the interchange cap as they are very important to the UK. Commercial Cards are a very different product compared to consumer cards, offering merchants, cardholders, and companies / governments providing them to their employees / civil servants specific and sophisticated services, which come at a higher cost to issuers. Unlike consumer cards, which compete with cash, commercial cards do not replace cash but traditional invoicing, which is a less efficient, less transparent, and more costly form means of payments. Commercial cards are also important in supporting small businesses as a vehicle for flexible short term financing. Capping interchange fees for Commercial cards would make issuers reconsider their issuance.
How you define a ‘commercial’ card is a complex question of course. Some people I have asked believe that a commercial card will, in future, need to be settled from a business bank account.
American Express seems to be taking steps to protect itself with two changes to its Gold Business and Platinum Business cards this week.
(These cards come with generous sign-up bonuses by the way. Gold Business offers 20,000 Membership Rewards points whilst Platinum Business offers 40,000 points.)
Here is the wording sent out:
“We will add new wording to your Agreement to clarify that you and any Supplementary Cardmembers may only use the Card for business purposes. This means that you and any Supplementary Cardmembers must not use the card for personal expenditure.”
There is also another change of the rules which means that supplementary cardholders no longer have any liability for the spending they make. The primary cardholder is solely responsible for settling their bill.
I am only guessing, but I assume that this is because Amex has verified that the primary cardholder is ‘in business’ and so can hold a commercial card. If the supplementary cardholder – who would usually be an employee – was liable for their own spending it could be used as evidence that Amex was issuing cards to ‘non business people’.
It isn’t clear whether Amex will deliberately start to close down Gold Business and Platinum Business accounts if it sees large volumes of personal spending going through. They may feel they have no choice if the alternative is to lose their ability to charge a higher interchange fee. At the moment, however, this is a moot point because the cap on interchange fees does not currently apply to Gold and Platinum Amex cards as I understand it.
Want to earn more points from credit cards? – March 2024 update
If you are looking to apply for a new credit card, here are our top recommendations based on the current sign-up bonuses.
In February 2022, Barclaycard launched two exciting new Barclaycard Avios Mastercard cards with a bonus of up to 25,000 Avios. You can apply here.
You qualify for the bonus on these cards even if you have a British Airways American Express card:
Barclaycard Avios Plus Mastercard
Get 25,000 Avios for signing up and an upgrade voucher at £10,000 Read our full review
Barclaycard Avios Mastercard
5,000 Avios for signing up and an upgrade voucher at £20,000 Read our full review
You can see our full directory of all UK cards which earn airline or hotel points here. Here are the best of the other deals currently available.
British Airways American Express Premium Plus
25,000 Avios and the famous annual 2-4-1 voucher Read our full review
American Express Preferred Rewards Gold
Your best beginner’s card – 20,000 points, FREE for a year & four airport lounge passes Read our full review
The Platinum Card from American Express
40,000 bonus points and a huge range of valuable benefits – for a fee Read our full review
Virgin Atlantic Reward+ Mastercard
15,000 bonus points and 1.5 points for every £1 you spend Read our full review
Earning miles and points from small business cards
If you are a sole trader or run a small company, you may also want to check out these offers:
SPECIAL OFFER: You receive a huge 120,000 Membership Rewards points if you apply for American Express Business Platinum by 9th April 2024. You receive 80,000 points for spending £12,000 within 90 days and a further 40,000 points if you retain the card for 14 months. Click here to apply.
SPECIAL OFFER: You receive 60,000 Membership Rewards points if you apply for American Express Business Gold by 9th April 2024. Remember that the card is FREE for the first year. You receive 40,000 points for spending £6,000 within 90 days and a further 20,000 points if you retain the card for 14 months. Click here to apply.
British Airways Accelerating Business American Express
30,000 Avios sign-up bonus – plus annual bonuses of up to 30,000 Avios Read our full review
American Express Business Platinum
Crazy 120,000 points bonus (to 9th April) and an annual £200 Amex Travel credit Read our full review
American Express Business Gold
Huge 60,000 points sign-up bonus (until 9th April) and free for a year Read our full review
Capital On Tap Business Rewards Visa
Get a 10,000 points bonus plus an extra 500 points for our readers Read our full review
For a non-American Express option, we also recommend the Barclaycard Select Cashback card for sole traders and small businesses. It is FREE and you receive 1% cashback on your spending.
Barclaycard Select Cashback credit card
2% cashback on all your business spend for 3 months (1% thereafter) and no annual fee Read our full review
Comments (54)