The news: Amex Rewards Checking is the issuer’s first consumer checking account. The no-fee, digital-only account is available to eligible US cardholders and has four core features:
What it means: The new checking account helps Amex tap into three growing areas of the payments and digital banking ecosystem.
The bigger picture: Here’s how the checking account can benefit Amex’s credit card business, which lies at its core.
The new account can tighten customer relationships. In Q4 2021, Amex’s US network volume reached $256.2 billion—up 31.3% annually. The new account meets customer needs in ways that drive spend across the board among users looking to maximize benefits across Amex accounts. This can accelerate spending growth and help Amex diversify amid slow spending growth in travel and entertainment—a core sector of its business. It also offers the issuer a long-term engagement pipeline.
It can also help Amex attract younger users. Gen Zers and millennials accounted for 60% of new Amex accounts in Q4 2021. This could signify an overall shift in card market demographics. But creating a digital bank account could cater to these users’ preferences and give customers new to Amex more opportunity to take advantage of its offerings.
And it can improve Amex’s competitive positioning. For years, the issuer has gone toe-to-toe with Chase’s Sapphire program, which has offered a checking account since 2019. Rewards Checking creates more parity between the two programs as they compete for users.
Related content: Check out our Banking Briefing to learn how Rewards Checking can help Amex future-proof itself as variable recurring payment tech grows more prevalent.