What You Didn't Know about Amex's ‘Please Pay By' Date

When you borrow money from someone, and you both agree that you will repay the amount in four weeks, but two weeks later the person asks you to pay back kindly, you will wonder what happened to the four weeks agreement. If they tell you that it was just a reminder in case you have forgotten, then that means you still you have another two weeks to give back the money. Such has become the confusion that Amex has brought upon its customers.

Communication has always been a bone of contention; even most marriage counselors observe that spouses usually have a marital conflict because of poor communication, or lack of it. Unfortunately, that has seeped its way into financial institutions, and we all know it can be quite costly if you do not understand the language used in all those policies we have to comply to, and which they keep amending now and then.

For instance, here is what you didn't know about Amex's please pay by date and this information will come in handy when you need some more time to pay your charges.

Using a charge card versus a credit card

First and foremost, if you use the words "credit card" and "charge card" interchangeably, you could not be more wrong since they are different. A credit card allows you to pay part of your bill each month due to the pre-set revolving credit limit. On the other hand, a charge card does not afford you that option. While few banks continue to issue charge cards, Amex has kept doing so therefore if you have the Amex Green, Amex Gold or Amex Platinum, you are using a charge card; the rest like Delta or Everyday cards are credit cards.

If you are one of those people who pay their bills every month without fail, the difference may not account for much; if not, it could cost you. For instance, when you look at an Amex Platinum statement, you will realize that at the top there are two dates, the closing date, and the next closing date. Below the new balance, you will find the "please pay by" date which has a little mark on it. At the bottom of the statement, the mark explains that although the payment is due upon receipt, "please pay by" date is a suggestion to avoid paying a late fee if you do not pay by the closing date.

What happens when you don't pay by the "please pay by" date

For those who fail to read the amendments that banks provide you with just because the bank's online portal informs you of what you need to know, you might want to rethink that decision. Such actions might land you in trouble because effective January 1, 2017, the terms changed such that while before you had to make your payment before the next closing date, now you have to pay before the due date otherwise you will pay extra due to the late fee charged.

If you are not careful and think that Amex is like the other credit cards you own, you will pay the late fees. The reason is while other credit cards give you about a week before the next closing date, the Amex charge card does not give you that luxury. Instead, the please pay by is only 15 days away from the statement closes. As a result, if you receive your statements by mail and the postal service gets a little delay, you most likely will have a week to pay your bill.

Amex's stand on the dates

According to Amex, the revised terms are being misunderstood by the customers because even if you pay your bills fully by the next closing date, you do not pay any extra money as late fees. However, they are not clear about the percentage or amount they charge as late fees which could leave lots of customers confused and in a panic as they try to avoid excessive charges. Matter of fact, the lack of clarification landed the bank in hot soup in 2012 when it paid an $85 million fine for putting down the, "please pay by" date as the real due date on the account.

Final verdict

As much as we want to use the charge cards, it is better to be cautious and always read between the lines to ensure that you do not pay money earlier than when you have to; we could, after all, make use of the extra coin before then.