George S. May Business Blog

AmEx paying card holders to close their accounts

American Express has offered to pay a limited number of their card holders $300 to pay off their balances and close their accounts.

“We sent the offer out to a select number of card members,” said Molly Faust, a company spokeswoman. “We are looking at different ways that we can manage credit risk based on the costumers overall credit profile.”

It has not been said how many people were given this offer, nor the total of their card balances.

American Express is extending this offer, at this point, until the end of February. However, American Express card holders who agree to the plan by March have until April to come up with the funds to pay off their balance. After the balance is paid, the $300 will be sent to each American Express card holder in the form of a pre-paid American Express card.

Prior to the past few years, AmEx was generally regarded as a credit card for wealthier people. American Express attempted to expand by offering their card to wider range of clients, a move that has not proved to be good judgment, as the company’s earnings tumbled in the recent fourth quarter.

Although American Express has gotten me to write on this, I have to say this may be one of the most ridiculous, non-newsworthy stories-du-jour. If people can pay off their credit cards in one shot, they will. Why would someone sit on a credit card payment they could make? Because they enjoy paying interest? This honestly reminds me of the old Shel Silvertstein poem, “Smart” where the kid trades his silver dollar for two quarters:

 ”My dad gave me one dollar bill
‘Cause I’m his smartest son,
And I swapped it for two shiny quarters
‘Cause two is more than one!

And then I took the quarters
And traded them to Lou
For three dimes — I guess he don’t know
That three is more than two!”

And then I went to AmEx,

whom I want to thank about,

giving me three hundred dollars,

To empty my bank account.

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