American Express has launched a rewards-based consumer checking account with a contactless debit card, following up on a similar product the company launched last year for its
The move comes as fintechs including Chime and Varo are targeting younger and underbanked consumers with digital accounts that include financial services management tools with their apps. Traditional payment companies like Discover Financial Services and PayPal have responded with similar products.
The new American Express Rewards Checking for consumers pays 0.5% interest with the ability to earn one Amex loyalty point for every $2 spent on the debit card — about half the rewards-earning rate for credit card spending — Amex said Tuesday.
Users may combine checking account rewards with other Amex loyalty points within Amex’s mobile app, the company said.
“Our members want more banking products and services from us,” Eva Reda, executive vice president and general manager for consumer banking, said in a press release.
The product launch comes three months after Amex rolled out a digital checking account for small businesses that pay a 1.1% interest rate and comes with a debit card.
As with the savings account Amex has long offered, the company’s checking accounts are held by American Express National Bank, which Amex established in 2008 to stabilize its funding during the recession.
Discover Financial Services, which has offered a suite of direct banking products
PayPal began rolling out its first digital savings account to consumers late last month, offered in a partnership with Synchrony Bank. The account, which pays 0.4%, will be available to all users of PayPal’s app this spring,
