American Express takes aim at rival Brex with new card offerings for startups

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American Express Co. is rolling out a new corporate-card program for startups after newcomers like Brex Inc. have had success in grabbing a slice of the market.

The cards will be available in coming months, offering full corporate liability without requiring founders to provide a security deposit or personal guarantee, New York-based AmEx said Thursday in a statement. New technology allows AmEx to see a startup’s bank balance to let fledgling firms qualify for cards, said Anna Marrs, president of global commercial services.

“It’s a new data source and a new lens on underwriting,” Marrs said in a telephone interview. “We acknowledge that for a younger company, with a younger set of founders, the traditional corporate program wasn’t meeting their needs.”

American Express is taking aim at a part of the market that’s become popular for startups themselves. Brex, the fintech company that’s been called AmEx 2.0, garnered a $2.6 billion valuation just one year after launching its first product, a corporate card for its fellow startups. Stripe Inc., a payments provider most recently valued at $35 billion, also has a corporate card for small companies.

The world’s largest commercial card issuer by spending, AmEx has relationships with 60% of Fortune 500 companies globally. It has been jockeying to gain a greater share of business-to-business payments and working-capital loans, which it says represent a $90 billion profit opportunity.

Expanding in commercial cards is a key part of a strategy laid out under Chief Executive Officer Steve Squeri, who took the helm in 2018. Prior to becoming CEO, Squeri consolidated the commercial operation that supported small, middle-market and large companies into one division that now represents 40% of spending on AmEx cards.

AmEx is also rolling out broad changes to its Green, Gold and Platinum corporate cards, including by adding benefits for purchases made for Uber Inc. rides or Hilton Worldwide Holdings Inc. hotel stays. The card issuer is also introducing digital expense-reporting tools for business customers.

“Business-to-business payment offerings feel too clunky,” Marrs said. “There’s no one on the planet who gets excited about filing an expense report.”

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