american express making lives better

As we all know that American Express is one of the top financial institutes in the world. There are already a staggering number of clients from the U.S. alone. They’ve been stuck to the credit card offers, credit based packages and lots of tidbits that this company had to offer. Also, the current statistics of American Express in the stock market are quite healthy.

A.E’s per stock price is $47.16, which is a little ahead of the 5% market price. Most of the revenue is kicking in through the commission that is charged to clients and merchants, during their transactions. For instance, the client (your shopkeeper) has to pay a small amount of fee for using American Express’ services. Likewise, you’re also charged some percentage if you’re using a credit card.

As per the Durbin Amendment that was enacted in July 2010, the Feds are now in charge of controlling this “small fee”. Guess what? The overall response to the 12 cent per transaction charge on Debit Cards has been widely appreciated by the clients. However, this 12 cent amount can add up to a loss of $13 billion in revenues for American Express and its partners in crime.

Are the banks going to solve this issue?

Of course, any sane bank wouldn’t want to lose money on frequent basis. The banks are making up for the negative profits through an unexpected increase in the monthly fee of the corresponding accounts. This fee will probably be charged under the pretense of “Maintenance Dues” to most of the debit and credit card holders.

Each month, the bank will be deducting $4 for these so called maintenance charges, or whatever they like to call it. This process will be recurring and will continue to go on for an indefinite amount of time.