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American Express Working Capital Terms Review
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Expert Analyst & Reviewer
UPDATED
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American Express Working Capital Terms
| Total Rating | 4.5 |
|---|---|
| Terms & Fees | Excellent |
| Application Process | Excellent |
| Sales & Advertising Transparency | Good |
| Customer Service | Excellent |
| User Reviews | Excellent |
Pros
- No origination fee
- Reasonable terms and fees
- Suited for small businesses
Cons
- Only available to American Express customers
- Can only be used for direct vendor payments
Overview
You’re probably already familiar with American Express, even if its plastic isn’t currently in your wallet. If not, it’s a financial services company based out of New York City. The company is best known for issuing charge cards. The iconic green, gold, and platinum cards are only a small piece of what the company offers these days, however.
One of American Express’s more unique products, available only to business credit cardholders, is its Working Capital Terms program. It fills an unusual niche in the short-term loan world, allowing borrowers to defer all payments for the life of the loan, paying it back in full at the end.
Curious how it works? Read on.
Not carrying an Amex business card? Check out our short-term funding comparison chart.
Table of Contents
Services Offered
American Express offers the following loan products:
For more information about its other lending products beyond Working Capital Terms, check out our American Express business loans review.
Borrower Qualifications
These are the preferred prerequisites to qualify for an Amex working capital loan:
| Requirement | Minimum requirement |
|---|---|
| Time In Business | 24 months |
| Personal Credit Score | N/A (see below) |
| Business Revenue | $200,000 per year |
You’ll also need to be an American Express business credit cardholder. Amex won’t run a new credit check on you when you sign up for a working capital loan; instead, the company uses the information it has on file about you as an Amex customer.
Terms & Fees
Here are the terms for Amex’s working capital loans:
Requirement Minimum requirement Borrowing Amount $500-$150,000 Term Length 30, 60, or 90 days Fixed Fee 0.6%-5.25% of the borrowing amount Origination Fee None APR Learn more Collateral None
Amex’s Working Capital Terms loosely resembles a short-term loan, but it is a pretty unique product on closer inspection. How so?
First of all, the funds from this working capital loan never actually pass through your hands. Rather, you select a vendor you want to pay with those funds. If you’re approved, Amex will pay that vendor.
With most short-term loans, automated payments — usually daily — kick in immediately. With an American Express working capital loan, while you’re still charged a fixed fee (for example, if you borrow $10,000 at 2.1%, you’ll owe $10,210 — or 10,000 * 0.021), you don’t pay it back in installments. Instead, the full balance is due by the end of your term. Essentially, you’re deferring your payment for one to three months in exchange for a small fee. This can be useful for businesses that need to smooth out their cash flow. Just be aware that you’ll have to link your bank account to Amex’s system to qualify for the loan, and it will be automatically debited in full from your account at the end of the term.
The longer the term length you choose, the higher your fixed fee will be. The base rates are as follows:
- 30 Days: 0.6%-1.75%
- 60 Days: 1.2%-3.5%
- 90 Days: 1.8%-5.25%
Note that you can pay your loan back earlier if you choose without penalty.
Application Process
To apply for Working Capital Terms, you have to be an American Express Business cardmember. You’ll also need to agree to use electronic records and signatures and electronic communication (including email), and link a bank account to your American Express account. Enrollment in the Working Capital Terms program is not automatic.
If you meet the prerequisites, you can enroll one of your businesses in Working Capital Terms through the Amex website. Approval is conditional on the information American Express already has on file about you, including but not limited to your credit history.
To initiate an individual loan after you’re approved, simply select a vendor you’d like to pay. Approval is contingent on your current standing with Amex, the vendor’s eligibility, and the amount of money you’re seeking. Funds are deposited in the vendor’s account within two business days.
Sales & Advertising Transparency
Just about all the information you need is available on Amex’s website so long as you’re willing to navigate through a page or two and scroll down to the fine print at the bottom of the page. As with the company’s other products, the decision-making process it uses to determine credit limits remains a bit arcane, but that’s a minor gripe.
If you have experience hunting down card information on American Express’s site, you won’t be in for any surprises here.
Customer Service & Technical Support
Customer support is available through the company’s website or by phone. If you’re looking at Working Capital Terms, chances are you’re already using American Express’s platform, through which you can also use to interact with the company. If you prefer social media, American Express has a presence on Facebook, Twitter, Instagram, LinkedIn, and YouTube.
American Express has a generally positive reputation where customer service is concerned. Most of the Working Capital Terms process is automated, so you’ll likely only interact with personnel if something goes wrong.
User Reviews
Negative Reviews & Complaints
American Express has maintained an A+ rating with the BBB. As you might expect of a company of its size, however, there are plenty of criticisms to go around. Here are a few:
- Unclear Terms: Mostly related to Amex’s charge cards, these complaints cited credit limits and fees that went up without notice. This extends a little into its lending with regard to the factors used to determine your eligibility and borrowing amounts.
- Technical Difficulties: A few customers complained about funds being routed to the wrong account or vendor.
- Limited: You can only use these loans to pay vendors directly.
- High Revenue Requirements: Because businesses must make at least $200,000 per year to qualify for Working Capital Terms, some smaller businesses may have a hard time meeting the requirements.
Positive Reviews & Testimonials
Here are some of the nice things customers say about American Express and its loan products:
- Fast: Amex can get your funds to you or your vendor, typically within a couple of days.
- Good Customer Service: Most customers found American Express’s customer service to be helpful and knowledgeable.
- Good Rates: For this type of loan, American Express offers excellent rates to prospective borrowers.
- Convenient: Once you’ve signed up for the program, the process is mostly automated, making it easy to use.
Final Verdict
American Express Working Capital Terms loans are a convenient and affordable way for businesses to defer payments to vendors for up to three months. It’s a niche but useful product for Amex’s business card customers who aren’t able to arrange similar terms directly with their vendors. The Working Capital Terms program’s fairly high revenue requirements may exclude some of the businesses that would most benefit from this type of loan. Those that qualify, though, should definitely keep this product in mind.
A few minor points of caution come to mind. If you’re not careful, the lump sum transaction at the end of your term could wreak some havoc on your finances. It’s also not easy to determine in advance whether Amex will approve of your vendor and your loan.
Not ready to commit to a charge card? You can find other funding sources through our comparison charts for merchant cash advances and small business loans.
Erica Seppala
Expert Analyst & Reviewer at Merchant Maverick
An expert in accounting, finance, and point of sale, Erica has been researching and writing about all things small-business since 2018. Erica's insights into personal and business finance have been cited in numerous publications, including MSN, Real Simple, and Reader's Digest. She is a graduate of Limestone College.
View Erica Seppala's professional experience on LinkedIn.
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The program is a joke. Sure, the advertisement sounds good but HOW can you run a business with this program when your availability consistently changes. One day you login you can borrow $40K, the next day it’s 19K then another it’s 20K then it goes back to 40K then another it’s 0. Who would deals with that BS?One day you show 40K so I am plan on using login a day later and it’s 0.that entire program is useless
Organization Name: Sports Net Action Photos LLC
Program is a joke. I found it extremely helpful when it first came out about 3 yrs ago, then in 2020 without notice and for no apparent reason we have 0 availability. I call and have been told its an algorithm and I should keep signing in everyday to check my availability. I honestly have no time to check a 0 bal everyday. We have a line of credit that is there when we need it…this process is just a waste of my valuable time.
Organization Name: aplomb development
I am more attempting to provide aid to the other people talking on here. I originally searched for a simple phone number for the department , but I saw the comments and thought i would help . AMEX uses a common credit score and nothing else . It can incredibly frustrating , as i too have plummeted from 250k to 0k in 24 hours for what i would say is no reason at all, and amex was not able to convey a reason either… come to find out ( I have 9 amex cards,) that the entire reason for them turning off the account was a dip in my credit score , but it was literally their fault too . I made one mid sized purchase on a revolving debt amex card. It was around 20k , and i believe my purchase used 19k and change, as I have planned on paying it off the following month . Only it hammered my ratios on my credit score dropping it almost 50 points . Nothing in my life changed , yet amex reporting that charge to the credit bureaus lowered my score enough to squash a quarter of a million dollars I was going to use for payroll. The amex wrkng capital dept is simply a reflection of your current credit score at any time , these are the rules of the game , play it , or do not play the game , but once knowing the rules the game , makes it kinda useless to complain , for one cant simply sit the game out .
Organization Name: New York ATM
Used to be a great program…I had worked my credit line up to $135K over 1.5 years by using it 2x per month for 5 figure business purchases and ALWAYS paying back on time or even early.As Ted says, now all our lines are cut to zero with no communication and no one at customer support knows anything. The online customer chat box has even been disabled.I run an “essential” business and all our bills are being paid on time and my personal credit score is 750.So much for the “Amex has got your back” ad campaign. My last loan is due at the end of the month and when it is paid off I will probably never use this program again. A credit line that is there only in good times is useless.
This comment refers to an earlier version of this review and may be outdated.
Organization Name: LHD
What is the response of American Express Working Capital for the COVOD-19 these days ?They…CUT your limit and no more funds available ! Yes, this is how this company treats the customer. This is help made by AMEX.My advice – stay away of them unless you like the troubles.
This comment refers to an earlier version of this review and may be outdated.
This program does not make any sense for business since the basic factor in that is planning your finance moves. AMEX does not provide any info about the current limit of your loan . You can see one day you can borrow $100k, a day later it is $50k, a week later $120k. Looks like a lottery – you need look into every hour. Unpredictable and unreliable service. Wonder who is the author of this lottery.
This comment refers to an earlier version of this review and may be outdated.
Organization Name: connections unlimited inc.
I concur with your comments. You can NEVER be certain funds will be available when you go to pay a vendor. My available funds have ranged from $30K to $70K+. I have NEVER missed a payment and I have used the program regularly. Then, suddenly and without notification or explanation, I go online to make a payment to an established vendor and the $70K that was available is suddenly $0.00. Attempting to get an explanation by telephone, after more than an hour on the phone, no one could give me a comprehensible explanation. I USED to recommend the program. I no longer will.
This comment refers to an earlier version of this review and may be outdated.