Cash back for businesses that are cash strapped: A review of the Plum Card from American Express
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Update: Some offers mentioned below are no longer available. View the current offers here – The Plum Card® from American Express
The Plum Card® from American Express overview
The Plum Card from American Express is a unique business charge card with a flexible payment option. You can get a discount of 1.5% for paying early or you can get up to 60 days interest-free (on new balances) when you make the minimum payment. However, unless you’re a business with fluctuating cash flow, other higher rewards-earning cards will likely suit you better. Card Rating*: ⭐⭐
*Card Rating is based on the opinion of TPG’s editors and is not influenced by the card issuer.
The Amex Plum card is a simple business charge card. Normally, charge cards need to be paid off in full each month, but with the Plum card you can take advantage of an up to 60-day interest-free period (see rates and fees), as long as you make the minimum payment by the due date.
An American Express business card won’t add to your Chase 5/24 count, and as a charge card, it won’t count toward your limit of four American Express credit cards or 10 charge cards.
That said, this card is very light on benefits. In most cases, you’d be better off applying for one of TPG’s top business credit cards. There are many cards on that list with more modest annual fees, first-year benefits valued at more than $1,000, and comparable (or better) ongoing reward rates.
Let’s take a closer look at the Plum Card to see if this card might be a fit for you.
Who is this card for?
The Amex Plum card is for business owners who aren’t interested in earning travel rewards, want their credit card perks to directly impact their bottom line and value simplicity above all else. The card doesn’t have any benefits that require extra time to manage. It’s simple, which can save you both time and precious mental bandwidth that you need to run your business.
In comparison, The Business Platinum Card® from American Express is loaded with perks, and each benefit (however valuable it may be) requires a bit of maintenance.
For instance, the annual airline-fee credits of up to $200 only apply to a single airline and have restrictive terms. That credit works differently from the up to $200 in annual Dell credits, half of which can be earned in the first half of the year (Jan. – June) and the other half in the second half of the year (July – Dec.). You’ll get additional credits in 2020 due to coronavirus.
All of that is in addition to the benefits that require enrollment, like Priority Pass lounge membership and hotel and rental car elite status benefits.
There is so much going on with the Amex Business Platinum card that we’ve written a guide on the 10 things you need to do when you get your Amex Business Platinum. The Plum card is a much simpler, no-nonsense option.
The card’s $250 annual fee (see rates and fees) is waived for the first year.
Unfortunately, the Plum card currently doesn’t have a welcome offer. However, as mentioned, the card’s annual fee is waived for the first year.
Main benefits and perks
With the Plum Card, you’ll earn a 1.5% discount on eligible charges you pay within 10 days of your statement closing date. The discount is applied to your account as a credit on the following statement. You don’t need to manage rewards or choose from a number of different redemption options – everything is automated for you.
You also have the option to carry a balance interest-free for up to 60 days. To qualify for this option, you’ll need to pay at least the minimum amount due (10% of new purchases plus all of any previously deferred balance) by the due date. Deferred amounts are not eligible for the 1.5% discount.
Additionally, employee cards are complimentary and you’ll get a suite of expense management tools to help with oversight on your spending.
How to use this card
The best way to use the Plum Card is to make purchases and pay them off early, within 10 days of your statement closing. If you don’t do this, you’ll sacrifice the 1.5% discount and nullify the main benefit of using the card.
If you don’t want your rewards to be tied to paying your card statement early in order to earn rewards, then you’ll want to look elsewhere. Keep in mind that after the first year, the hefty $250 annual fee means that you’ll have to spend more than $16,660 per year to just break-even on the card’s 1.5% earning rate.
Plum card alternatives
My top choice for a no-annual-fee (see rates and fees). business card that remains simple is the Blue Business® Plus Credit Card from American Express. Instead of cash back, you’ll get 2x Membership Rewards points on all spending up to $50,000 in purchases each calendar year; then 1x. Those 2x points are the best earning rate for everyday purchases for a business card — equal to a 4% return based on our valuations.
Membership Rewards points can be used towards travel, including transferring points to airline and hotel partners. Though you’ll get the most value from your Amex points with travel redemptions, you can also redeem points for cash back, Amazon purchases, and gift cards.
The Capital One Spark Cash Select for Business has no annual fee and you’ll earn a straight 1.5% back on every purchase, with no limit to the amount of cash back you can earn. That’s a much simpler setup that what you have to do to earn the same amount of cash back with the Plum card.
Plus, the Spark Cash Select card has an intro bonus of $200 cash after you spend $3,000 on purchases in the first three months from account opening.
You can earn an even better bonus with the Ink Business Unlimited Credit Card. It earns the same unlimited 1.5% back everywhere and has an intro offer of $750 cash after you spend $7,500 in the first three months from opening the account. The Ink Business Unlimited Credit Card also has no annual fee.
The information for the Capital One Spark Cash Select has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
Is the Amex Plum Card worth it?
The Amex Plum Card is worth it if you own a business that has variable cash flow, and can take advantage of both the 1.5% cash back as well as the 60 days to pay in full. Keep in mind that you’ll have to spend over $16,660 to break even on the 1.5% back if you take into account the card’s $250 annual fee after the first year.
How does the Amex Plum Card work?
To make the most of the Amex Plum Card, you’ll get a 1.5% discount credited towards your next statement if you make a payment within the 10 days prior to the statement closing date. Alternatively, you can defer the remainder of your new balance to the next statement without accruing interest on the balance.
The main value of The Plum Card from American Express is its simplicity. It’s a charge card, so there’s no credit limit to navigate, and it earns 1.5% back on eligible early payments. The cash back is directly applied to your next statement automatically, so you don’t need to take any extra steps to redeem your rewards. But the card does have a $250 annual fee and you have to pay early just to earn the 1.5% discount.
When you consider that you can earn 1.5% back (or more) with several different no-annual-fee business credit cards, the appeal of the Plum card drops significantly.
For rates and fees of The Plum card from American Express, click here.
For rates and fees of The Blue Business Plus Card, please click here.
For rates and fees of the Business Platinum Card, please click here.
Featured image by Eric Helgas/The Points Guy.
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