About Clear From American Express

In a world of complex credit cards, Americans yearn for simple products without harsh penalties and conditions. In response, many banks have begun offering at least one card without the large menu of fees and penalties that commonly appear on the disclosure statements of their other products. American Express offers its Clear card for those who value simplicity, but still want to earn some credit card rewards.

How This Card Works

For each dollar spent, cardholders will receive one cent in their Automatic Rewards program. This program is extraordinarily simple; cardholders will receive a $25 American Express shopping card for each $2,500 in spending. Additionally, new customers will be offered a 0% introductory APR on purchases for the first 12 months after opening an account. Subsequently, interest on both purchases and balance transfers will be incurred at the standard rates, which are equal to the Prime Rate plus 13.99%, 16.99%, or 18.99%, depending on the applicant’s credit worthiness. There is no annual fee, no late fees, no balance transfer fees, no over-limit fees, and no cash advance fees with the Clear Card. Unfortunately, American Express is still charging a 2.7% credit card foreign transaction fee on all charges processed outside the United States.

Advantages

While, many of the cards that are being offered without the typical fees do so at the expense of a reward program. This card is able to curtail most fees while still offering a nominal 1% return in the form of American Express shopping cards. The 12 month promotional financing on purchases can be valuable to someone who will be carrying a balance and does not want to incur interest. Finally, this is one of the few American Express cards that does not have an annual fee, allowing customers to enjoy the complimentary travel insurance and purchase protection policies at no cost.

Disadvantages

While this card does offer rewards, they are only in the form of shopping cards. Cash back or a statement credit would have been a much easier way for most people to receive these rewards. Also, a reward worth 1% of spending is lower than that of other cards offering 2% or more in value. Although cardholders will not have to pay a late fee if their payment does not arrive in time, they will still incur a penalty interest rate equal to the Prime Rate plus 23.24%.Finally, even the lowest interest rate is not that competitive with some of the lowest APR cards available.

With no late fees and over the limit fees, this card is targeted at people who have run afoul of these penalties in the past. For cardholders who recognize that they are not always able to make their payments on time, or stay within their credit limit, this card offers them some respite from the penalties and fees that have become customary.