Overview:
American Express OPEN introduced the American Express Plum Card in 2007. It is a trade terms card that offers flexible payment options and pre-pay bonuses for business owners with annual revenue in the 6- to 7-figure range.
How This Card Works:
First, let’s define “trade terms.” Traditionally, businesses may provide lines of credit to other businesses as a professional courtesy. Trade terms help business owners manage their cash flow better. Businesses can receive materials and services they need, and then pay for them as money comes in.
For instance, if you’re a retailer, trade terms you’re your wholesaler can prevent you from having to pay for items you haven’t sold yet. Typical trade terms are “Net-30” (payment due 30 days after purchase) or “Net-60” (payment due 60 days after purchase.)
But not every business is willing to offer trade terms, especially when money is tight for everyone. The American Express Plum Card lets you get trade terms on any purchase for your business, simply by using the card. The card also rewards you for paying your balance in full.
When you use the American Express Plum Card, which has no pre-set spending limit, you can earn a 1.5% discount on eligible purchases when you pay your balance in full within 10 days of the statement closing date.
You also have the option of deferring payment. If you pay at least 10 % of the balance from new activity on our billing statement, plus the entire amount of any previously deferred payment, you can defer payment of 90% of your new purchase until the closing date of your next billing cycle with no penalties. In other words, you can enjoy “Net-60” terms on new purchases, providing you pay off your existing balance.
Benefits:
American Express tends to be very generous with its benefits for CardMembers, and the Plum card is no exception. Perhaps most notable is the Open Savings program, which provides savings from select companies and vendors on all purchases when you use your American Express OPEN Plum card. The Plum website provides a forum where business owners and Cardmembers can network, discuss money management, and brainstorm ideas to grow their businesses.
This review would go on forever if I listed all the benefits. Some other highlights include:
- Roadside assistance up to 4 times per year.
- Car Rental Loss & Damage Insurance
- Baggage Insurance Plan and Travel Accident Insurance
- Purchase Protection & Return Protection
- 24-hour Identity Theft Assistance
- 24-hour Global Assist Hotline (when traveling more than 100 miles from home)
Fees:
The American Express OPEN Plum Card has an annual fee of $185, waived for the first year. You can receive one additional Plum Card with no annual fee. Subsequent additional cards have a $45 annual fee.
Penalties for late payments vary, and could be as much as $39 or 1.5% of the delinquent balance, or 2.99% of a “seriously delinquent” balance.
Since there is no pre-set spending limit, there are no over-the-limit fees.
Pros:
- Flexible payment terms
- No finance charges
- No annual fee for the first year
- Generous benefits, especially for travelers
- No pre-set spending limit
- Discounts when you buy from OPEN Savings partners
Cons:
- Must have revenue of at least 6 figures annually to qualify
- $185 annual fee after the first year
- No rewards program
Apply for The Plum Card® from American Express OPEN
- Credit RequiredExcellent Credit
- Rewards ProgramPay in full within ten days, get 1.5% cash back or pay as little as 10% and take up to 2 months to pay off the balance, interest free.
- Signup BonusAnnual Fee WavedNo introductory annual fee for the first year - a savings of $185
Dawn Allcot is a full-time writer, editor and blogger whose career spans two decades. Dawn joined the CreditShout team nearly two years ago. Since then, she's been sharing her knowledge and enthusiasm for managing credit and saving money through responsible credit card use.
January 24th, 2011 at 1:03 pm
“Beer, wine, and…cupcakes” (laugh).
This irritating ad appears on all the business channels: Fox, CNBC, and Bloomberg. The actress is not believeable. The women in business I know are embarrassed by her. “I can get free extra cardS for my employees” (read the fine print…only one). I carry an American Express Card, but I’m almost ashamed to admit it.
March 28th, 2012 at 11:45 am
Warning about the Plum card for your Readers:
I just got the Plum Card and was made aware of something that the Customer Service Rep wasn’t aware of until I pressed the issue and he had to find out the answer from a supervisor:
The 1.5% is strictly applied to payments within the first 10 ten days after the monthly cycle closes. The caveat there is that payments made during the monthly cycle do not get the discount reward. That’s an important distinction that will not necessarily be clear to anyone reading about the card and I think you should know that. I now realize that if I pay “too early”, the discount doesn’t apply. I was very disappointed. AMEX charge cards may not have a preset limit but they do have limits based on spending patterns. If I have $5000 available and use that in the first week of the monthly cycle on unforeseen expenses with several auto-debits still to come, I need to pay down the balance quickly within a few days and thus NOT get the discount on that payment. The discount only applies to the ENDING BALANCE. Now, if you have a stratospheric limit on the card, it won’t matter. But for many small business owners juggling expenses and spending limits while trying to get maximum rewards, this can and will be a nuisance. Applicant beware.