Like other prepaid cards, Direct Express comes with fees.
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American Express does not charge interchange fees but it charges so-called merchant discount rates.
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American Express says it nixed foreign transaction fees on certain cards to build loyalty among their cardholders, many of whom are frequent business travelers.
American Express earns revenues from card licensing fees, royalties on billings, charge volume, net spread revenue and cards in force, foreign exchange conversion revenue and also a share of the discount revenue earned by the operator.
For their part, American Express and Discover have never expressly forbidden such fees.
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American Express recently announced that it now waives forex fees for its big-spending platinum and centurion cardholders.
As a result, the revenue from discount fees charged from merchants accepting American Express cards increased by 5%.
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Facing regulatory restrictions and stiff competition from Visa, MasterCard and American Express, Discover has had to cut its fees in the last few years but still saw revenue growth as its purchase volume increased.
The American Express prepaid card has no activation or monthly maintenance fees.
Last year, the interchange fees averaged 2.23% for American Express, 2.06% for Visa and MasterCard and 1.88% for Discover.
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Notably, American Express, the card company regarded as wringing the highest transaction fees out of merchants and their customers, refused to settle with the DOJ.
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The commission declined to express an opinion about whether Vonage should pay general state taxes and fees, or if it's subject to state laws governing fraud, commercial dealings, marketing, advertising and other business practices.
Visa and Mastercard charge a 1 percent foreign transaction fee, American Express charges 2 percent, and the companies issuing the cards can add fees of their own.
The card can't incur overdraft fees, says Laura Kelly, a senior vice president at American Express.
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