I'm really not trying to pile on American Express. But the card issuer has been harassing customers for payments lately. We're not talking about customers who are already delinquent, either. Instead, what I am talking about is American Express going after customers when a payment isn't even due yet. I've been aware of this practice for some time but it appears that American Express has recently intensified its efforts to collect payments before they're due. American Express, your customers -- and I -- want to say something: stop it!
A reader sent me a note earlier this week. This single example is representative of the crap that American Express has recently been pulling. My reader, Scott, was pretty shaken up by the incident.
Here's what happened. Scott's employer sent him an email on his day off. Turns out that American Express called the employer and said that it was looking for Scott. No reason was given for the call, but American Express left a phone number where it could be reached. Scott, thinking something was wrong, called American Express right away. A customer service representative asked Scott to schedule a payment that day. Never mind that the payment on his American Express Gold card wasn't due yet (it's not due until the last day of February). What's more, Scott's payment was less than $1,100. "I have never been late with my payment and have no delinquencies," Scott told me. "It kind of took me by surprise and I asked why I couldn't make the payment by myself as I normally do."
That's a fair question. Well? "She mentioned the amount was over $1,000 and she was going to do it (schedule the payment). I tried arguing with her but she insisted that she schedule the payment. I told her I would pay the amount on the due date," Scott says. Not to be denied, the representative asked Scott where he works and what his current salary is. Scott provided the details. "She scheduled the payment for me ... and thanked me for choosing American Express. I was dumbfounded and felt like I had just finished a conversation with my babysitter or worse, big brother." Basically, Scott got steamrolled -- which, I am sure, he'd acknowledge was his fault. "This is very aggressive and borders on harassment. They must be running very scared," Scott guessed. Still, the representative scheduled the payment of nearly $1,100 and that was that.
But the story doesn't end there. Later that day, Scott received yet another phone call from American Express. This time it was calling him on his cell phone. The representative -- a different one -- said that she was calling about Scott's Gold card. Scott raised his eyebrow (have to love his description of the situation) and asked what she needed. Before she could answer, "she mumbled something about noticing on my account that I already talked with them today and that it was unnecessary to continue the conversation," Scott says. "She then thanked me for choosing American Express and hung up." Scott thought that was weird. He actually classified it as "weirdness."
But it's not weird. American Express works from a list. Customer service representatives call customers and harass them for early payments. I have not heard this, but it would not surprise me at all -- at all -- if these customer service representatives are compensated for bringing in early payments. Credit-card issuers have lots of internal contests. At Bank of America, for example, customer service representatives can earn bonuses (prizes) for getting customers to do balance transfers and direct deposits. I've heard that straight from customer service representatives' mouths. So, I would suspect that American Express is no different. Get a customer to pay earlier than scheduled and win a prize.
Scott wishes that he would have handled the situation differently with the first customer service representative. "After the conversation I wished I had been more confrontational and said something like: 'Are you changing the terms of my agreement today? If you want to change my due date, then go ahead, but send it in writing.' Of course hindsight is 20/20," Scott acknowledges. If he had done that, he would have been fine. I've talked to people who have received this "early payment" call. Some of them have told American Express to pound sand. And American Express does just that.
The fact of the matter is that Scott's American Express Gold card has a 15-day payment window. In other words, the payment is due no later than 15 days after the statement closing date. It's not two days; it's not nine days. It's 15 days. It's late on day 16.
You've made it all the way here. You're wondering why American Express is doing this. Here's my theory (at least with Scott): Scott normally has a balance of $400 or so each month. This month, however, his balance was nearly three times his average balance. American Express probably got skittish and decided to grab the payment as soon as possible. But, just like so many things with American Express, that's just foolish. If it was worried about being paid, why did it allow Scott to charge around $1,100 this month? Why approve some of the charges in the first place? It's just another example of American Express not having its "stuff" together.
American Express, give your customers a break. Stop trying to reach into their pockets before the payment is due. You're alienating them. You're annoying them. And -- in some cases -- you're flat-out harassing them. And just think. If you stop pulling these kinds of stunts, I'll stop writing these kinds of stories.
Sounds like a win-win situation for everyone.
UPDATE: Since writing this story, Scott has now been smacked down by American Express in the form of a hard spending limit. He was notified this afternoon that his no preset limit card now has a hard limit. Says American Express: "after a thorough review of your credit profile we have placed a spending limit" on your Gold card. Here is a copy of the letter (click to enlarge):
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