Flexible Payment Option

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aschmid

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May 13, 2005
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I have been offered a Flexible Payment Option (FPO) by AMEX on my Gold Charge Card.

This is essentially converts the charge card into a credit card for certain purchases.

All purchases over $200 don't have to be paid of at the end of the month but can be paid of via the FPO with interest charge.

The interest they charge is 17.99% and there are 55 days interest free. If you pay of the full amount on the card there is no charge of course.

I am not quiet sure if this is a real benefit or not. Of course it gives you the possibility to pay of your card over time if you make larger purchases, but on the other hand it also gives them the possibility to charge you interest when you exceed the 55 days.

Anybody has any comments, feedback or has used this before?
 

serfty

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My company uses a Qantas Business Gold Amex with this facility. Interestingly; for us, purchases over $500 go to the FPO account, not $200.

How it works in our case:
  • Any purchase over $500 automatically goes to the FPO account, not the charge account.
  • At the anniversary day of the month for the account, any interest payable on the FPO balance is calculated debited to the FPO.
  • A figure based on the FPO total owing is calculated and this is then credited to the FPO and debited against the Charge account.
  • The balance of the charge account is "due immediately" - however, in reality it needs to be paid before the next monthly anniversary date before penalties begin to accrue.
  • An additional amount is also published; paying that amount will clear both the Charge and the FPO accounts.
  • Any Payments/Credits made initially go to the charge account until the "Due Immediately" figure is reached.
  • Once the "Due Immediately" figure is reached, subsequent Payments/Credits are applied to the FPO.
  • I do not know what happens if you pay more than the full payout figure.:shock:

We find it gives some flexibility; like many other products like this it costs when used but it is different in that if not used there's no charge (e.g. bank overdraft ).
 
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