AMEX Corp Card for FOREX

[Cruiser Elite]

AMEX have introduced a new payment facility via their Corporate Cards which allows settlement of FOREX transactions via a Credit Card. This system has been mooted / trialled for best part of 5 years now - I was very hopeful it may have been of some serious benefit but who am I kidding? This is AMEX after all! FYI:

Hi Cruiser,

Thank you for your call earlier, as I am not in the credit card side of the business I have sent a request for someone to call you and explain the sign up process to you.

**Once given a new Credit Card number please call me to confirm this number and we can register you for bonus Membership Reward points from FXIP**

As discussed, American Express have recently launched Foreign Exchange Settlement on Card.

You will now be able to choose to pay your overseas suppliers on an American Express business card. Settlement on Card (SOC) is another method of settling foreign transactions. You can still choose your original method of payment, Direct Debit – Direct Credit – Bpay.

The card payment comes straight to us and then we would send on a telegraphic transfer as normal. There would be no merchant fees to your supplier for this payment.

SETTLEMENT ON CARD:

• Up to 51 credit free days allowing you reduce your working capital requirements and take advantage of early payment discounts offer by your suppliers
• Earn 1 Membership Reward point for every $1 spent that you can then use to offset your other business expenses. (Normally 1:30)
• 2.4% trade service fee – (No GST, Tax deductable)

With an example of a $100K monthly spend, you would be looking at earning roughly 1,200,000 Membership Reward points in 12 months, which is equivalent to $36,000 value in International Business Class travel.

If you also look at the cost of the 2.4% Trade service fee, which does not incur GST and is tax deductable, compared to the cost of running an overdraft, which on average sits between 8-12%, you could be looking at a significant saving.

Attached is a PDS and application form please read through the information and any questions please do let me know.

Kind Regards,

Amex

I don't think so.

 

[robd]

Got a bit excited…………………………… and then, kapow!

 

[Craigie]

If you are doing spot rate conversions then they're pretty competitive. And if you're settling the balance and not waiting until settlement on card then it is points for nothing essentially as they don't charge the 2.4%. Even if it is only $30:1point. My main client is signing up and we'll put a couple of trades through and compare it with our current forex broker, be interesting if they can actually do the rates they're promising. The rep was trying desperately to sign us up tho, that warned me enough.

 

[robd]

If you are doing spot rate conversions then they're pretty competitive. And if you're settling the balance and not waiting until settlement on card then it is points for nothing essentially as they don't charge the 2.4%. Even if it is only $30:1point. My main client is signing up and we'll put a couple of trades through and compare it with our current forex broker, be interesting if they can actually do the rates they're promising. The rep was trying desperately to sign us up tho, that warned me enough.

I read it as though there would be a 2.4% Trade service fee, regardless of whether you used the credit free days. Are you sure?

The normal FX IFT transactions currently give 1pt/$30 and Cruiser Elite is saying the transactions on the card give 1pt/$1, but that the fee would be 2.4% (as I read it).

 

[Craigie]

Speaking to a forex specialist there's 2 ways to settle the transaction. On card settlement which will give you $1:1 point but cost you 2.4%. Or cash settlement on trade which there's no fee but only $30:1. But the good thing is the tight rate to the spot

 

[Cruiser Elite]

Unless I am reading this totally incorrect and unless the FOREX trader who emailed me the details has also got it totally cough about then YES robd you are correct - indeed if you settle via CC then you are immediately levied 2.4% for the privilege - yes you have 51 credit free days to pay off the FOREX purchase + the 2.4% trade service fee - so buy USD100,000 and you will immediately be levied USD2,400 trade service fee for that trade - so you must pay out USD102,400 at the end of the 51 days and you will earn 100,000 MR pts = USD0.024/pt.

I guess some might sign up but certainly won't be me.

 

[Cruiser Elite]

But the good thing is the tight rate to the spot

Others have tighter.

But having said that their online portal is clearly the most user friendly I have seen - overall service is pretty good except they piss me off with their ingrained desire to gouge any customer with CC fees.

 

[robd]

Speaking to a forex specialist there's 2 ways to settle the transaction. On card settlement which will give you $1:1 point but cost you 2.4%. Or cash settlement on trade which there's no fee but only $30:1. But the good thing is the tight rate to the spot

Ok, I misread your post.

What margin are they quoting?

 

[robd]

Unless I am reading this totally incorrect and unless the FOREX trader who emailed me the details has also got it totally cough about then YES robd you are correct - indeed if you settle via CC then you are immediately levied 2.4% for the privilege - yes you have 51 credit free days to pay off the FOREX purchase + the 2.4% trade service fee - so buy USD100,000 and you will immediately be levied USD2,400 trade service fee for that trade - so you must pay out USD102,400 at the end of the 51 days and you will earn 100,000 MR pts = USD0.024/pt.

I guess some might sign up but certainly won't be me.

Nor me.
…...

 

[Craigie]

The AMEX forex 'specialist' gave me 7 pips off the spot.. Can you get better than that? I'd love to know how. We're currently paying about 12 pips and above and putting through $X MIL annually, would love tighter rates..

 

[robd]

The AMEX forex 'specialist' gave me 7 pips off the spot.. Can you get better than that? I'd love to know how. We're currently paying about 12 pips and above and putting through $X MIL annually, would love tighter rates..

I reckon you can do better than that. I'll pass on a tip that Cruiser Elite gave me, which has saved our company $25K + in only 4 months just on margin - sign up to a couple of FX companies and play them off. OzForex will give a good rate too. See what you can get elsewhere and then go back to Amex. I even had our bank come back and drop 5 off because they realised I wasn't putting the transactions through them anymore. I emailed Amex and told them I would have to switch back to the bank because they dropped the rate then Amex came back with an even better rate.