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If you’re a business owner who’s looking to get a credit card with flexible payment options, consider getting the Plum Card from American Express. This charge card can help your business with cash flow issues such as a decrease in income or an increase in expenses.
While it may not have a lot of perks and benefits like other credit cards, the card’s functions are pretty straightforward and offer great value for businesses.
Here’s a quick look on what the card can offer:
Amex Plum Card Key Benefits
Aside from the cashback and Net 60 Payment terms (which will be discussed below), you can also benefit from the Amex Plum Card’s other business features.
Let’s go into detail on what they are and how they can benefit your business.
No Pre-set Spending Limits
The Amex Plum Card gives business owners flexible capital because it doesn’t have a pre-set spending limit like other credit cards. This feature opens up lots of opportunities to further grow your business.
However, do take note that “no preset spending limit” doesn’t translate to unlimited spending. What it means is that your purchasing power will be based on how you use your card and your financial history.
Some credit cards don’t have this feature and they just set a fixed spending limit regardless of how good your credit record, income, and payment history is.
Delay Your Payments Without Interest
Charge cards don’t usually allow you to transfer balances but the Amex Plum Card gives you the choice to pay your monthly dues in full or to transfer them to the next billing cycle.
What’s great about it is you can also choose your billing cycle whether it’s at the beginning, middle, or end of the month.
However, you do need to pay a minimum amount plus the deferred balances you have every due date to avoid paying late fees.
The minimum payment is 10% of your current charges which means you can choose to have the other 90% deferred up to 60 days without paying any interest‡.
Get 1.5% Cashback For Early Payments
The Amex Plum Card is one of the best cashback cards in the market. It rewards cardholders with a 1.5% cashback if they pay before the statement closing date. You don’t have to worry about bonus categories because you’ll get unlimited cashback for every early payment that you make.
Take note that a statement closing date is different from a statement due date. The closing date is the last day of your billing cycle which is usually a few weeks before your due date. It’s basically the timeframe when your issuer starts to prepare your billing statement.
Here are the details:
- Paying early pays off: get an unlimited 1.5% Early Pay Discount on eligible charges within 10 days of your statement closing date and see the discount applied to your next statement when you pay at the least the Minimum Payment Due by the Please Pay By date. For example, if you pay $5,000 within the qualifying period, you’ll get a $75 credit.
- No cashback is earned if you pay beyond the 10-day qualifying period. For example, if you’re closing date is May 5th and you paid the amount on May 16th, you won’t get any cashback.
The 1.5% cashback for early payments and the Net-60 payment term can give your business lots of savings, especially if you’re struggling with irregular cash flow.
Zero Foreign Transaction Fees‡
There are no transaction fees on top of purchases made in other countries . This makes the Amex Plum Card a great companion whenever you travel, shop, or dine abroad.
Amex Plum Card Drawbacks
There’s no one card to rule them all because all credit cards have pros and cons. The Amex Plum Card isn’t perfect so you might want to read up some of its drawbacks below before you get it.
We’ve also included a few alternative cards below to help you decide.
Expensive Annual Fee
The card’s ongoing annual fee is $250.
There are other business credit cards that have lower or even zero annual fees. The perks may be different but if you care so much about the annual fees, you can check the Amex Blue Business Plus or the Amazon Business Credit Card.
No Welcome Bonus
The Amex Plum Card doesn’t offer any kind of sign-up bonus which is one of the big drawbacks of the card. It’s hard to justify if the $250 annual fee is really worth it.
The cashback being at 1.5% isn’t that competitive already and you don’t have the option to redeem the cashback for rewards because it will automatically credit to your next billing statement as a discount.
You can opt for other cards like the Chase Ink Business Cash which offers 5% cashback on certain categories such as office supply stores and a $750 welcome bonus at the time of this writing. Plus, it doesn’t have an annual fee.
Cashback Is Conditional
You need to pay within the 10-day qualifying period to earn the unlimited 1.5% cashback. While it’s a pretty decent deal, there are other cards that can do better like the Cash Wise Visa card that lets you earn unlimited 1.5% cashback without conditions.
The Cash Wise Visa also has a $150 cash rewards bonus if you spend $500 within three months of getting the card.
- You can defer paying some of your monthly bill with no interest charged
- No annual fee for additional cards
- 1.5% discount applied to your statement automatically each month
- No minimum threshold to receive discount – any amount will be automatically credited to your statement (as long as you make the minimum payment before the due date)
- $0 introductory annual fee your first year, then $250. annual fee is quite expensive even if it is waived for the first year
- No other redemption options — cash back can only be redeemed as a statement credit
- Cannot redeem points for travel
- Must pay bill within 10 days of statement closing to receive 1.5% discount
How To Apply For The Amex Plum Card
If your business has a good credit history, you’ll most likely get approved for the card. However, you can still get the card even if you don’t have a business credit history.
Your issuer will look at your personal credit history to see if you’re eligible or not.
What’s the required credit score?
If you’re a startup business that doesn’t have a business credit history, a credit score of 720 or higher is recommended. Just remember that your credit score isn’t the only factor that’s considered here. You’re income payment history matter too.
What Points Panda Recommends
The Amex Plum Card doesn’t have any value if not for its Net 60 Payment term. Take away that feature and you’re left with a low cashback rate, an expensive annual fee, and zero welcome bonus.
In fact, the payment flexibility is the only justification we can think of on why the $250 annual fee might be worth it.
The people who will only benefit from this card are businesses owners who belong to these two categories:
- You have enough cash to make early payments and earn 1.5% cashback
- Your business has irregular cash flow and you want to defer your payments up to 60 days without interest
There’s a way to breakeven on the card’s annual fee with the 1.5% cashback rate. However, you would need to spend around $16,667 per year which is $1389 per month on early payments.
If your business can’t spend this much annually, we’d recommend that you’d get another card.
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