American Express Paying Customers to Close Their Accounts

In another sign of the times, credit card issuer American Express is reportedly paying customers to close their accounts.

The company, now a bank holding company so it can take advantage of TARP funds, is apparently offering $300 to a “limited number” of its U.S. card holders who pay off their balances and close their accounts.

Company spokeswoman Molly Faust told Reuters it was looking at different ways to “manage credit risk based on the costumers overall credit profile.”

Customers who received offers have until the end of this month to accept the offer, and must close their accounts in March or April.

Those who comply will receive a $300 American Express gift card, not exactly cash, but still free money to some degree.

Shares of American Express hit a fresh 52-week low today, a reflection of the ongoing credit crunch that seems to be making its way into consumer accounts.

Last week, the company revealed that credit card delinquencies rose in January more than analysts had expected, pushing shares lower.

In recent months, American Express has also cut credit lines and scaled back 0% APR introductory periods on balance transfers.

Its range of Blue credit cards, which are revolving accounts and more readily available, saw their introductory periods pushed from zero percent to the standard purchase APR, typically in the teens.

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