Home » Financial Education » What Is a Charge Card?

What Is a Charge Card?

What Is a Charge Card?

*Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any credit card issuer. This site may be compensated through a credit card issuer partnership.

This article was last updated May 29, 2020. Terms and conditions may have changed. For the most accurate information, please consult the issuer website.

From just looking at them , you wouldn’t know that charge cards are any different from credit cards. But though they look and act like credit cards, charge cards have some major differences.

Charge cards vs. credit cards

You could say that charge cards, such as the Diners Club card by Discover in 1950, gave birth to the credit card. Today, however, only American Express continues to issue consumer and business charge cards in the United States, though not all Amex cards are charge cards. There is also the Brex for Startups charge card, which is marketed to well-funded entrepreneurs.

The most notable difference between charge cards and credit cards is that credit cards allow cardholders to revolve a balance from month to month, as long as they meet the minimum payment due each statement period. Whereas charge cards typically require cardholders to pay the balance in full every billing cycle.

The exception is if you take advantage of Amex’s Pay Over Time feature on its charge cards, which lets you carry a balance with interest on eligible charges — up to your Pay Over Time limit, which is set by Amex. When an Amex charge cardholder elects this option, the charge card is essentially functioning like a credit card.

Do charge cards have spending limits?

With a credit card, you have a set amount of money from which to borrow, which is called your credit limit. This is set by the issuer when you’re approved for a card, and takes factors such as income and length of credit history into account. Charge cards, by contrast, have no preset spending limit.

This does not mean you’ll be able to spend an unlimited amount with a charge card, however. American Express does limit your spending based on your use of the card, payment history, credit record, financial resources and other factors. And how much you can spend may change over time.

Will a charge card help you build credit?

In short, yes, although to a much lesser degree. While the account will be reported to the credit bureaus, since there is no credit limit, the card’s balance won’t factor into your credit utilization ratio (which accounts for 30% of your FICO Score).

So, while keeping balances low on your credit cards will lower your credit utilization ratio and boost your credit score, purchases made on a charge card with no credit limit won’t have any impact.

A rule of thumb is to use no more than 30% of your available credit lines on credit cards. For example, on a credit card with a $2,000 limit, your balance should be no larger than $600.

Read: How to Calculate Your Credit Utilization.

List of charge cards

American Express® Green Card

American Express® Green Card

Apply Now

on American Express's secure site

Terms and Conditions apply

Rates & Fees

  • No Foreign Transaction Fees

  • 30,000 Membership Rewards® points after you spend $2,000 on purchases on your new Card in your first 3 months.

  • Earn 3X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery. Additionally, earn 3X Membership Rewards® points on all eligible travel, from subway swipes and window seats to hotel stays and city tours.

Highlights
  • Earn 30,000 Membership Rewards® points after you spend $2,000 on purchases on your new Card in your first 3 months.
  • Earn 3X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery.
  • Earn 3X Membership Rewards® points on all eligible travel, from subway swipes and window seats to hotel stays and city tours.
  • Earn up to $100 in annual statement credits to help you get through security faster with CLEAR®.
  • Earn up to $100 in annual statement credits to access 750+ airport lounges globally through LoungeBuddy.

See additional details for American Express® Green Card

More Info

This card is best for travelers and foodies looking to earn generous rewards on purchases including flights, subway rides and dining out at restaurants.

Rewards: Earn 3X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery. Additionally, earn 3X Membership Rewards® points on all eligible travel, from subway swipes and window seats to hotel stays and city tours..

Welcome offer: 30,000 Membership Rewards® points after you spend $2,000 on purchases on your new Card in your first 3 months.

Annual fee: $150

Additional benefits:

  • Up to $100 annual credit for airport lounge access via LoungeBuddy.
  • Up to $100 annual credit toward membership with the CLEAR security program.
  • Trip delay insurance and baggage insurance plan.
  • Car rental loss and damage insurance.
  • Global Assist Hotline access when traveling more than 100 miles from home.
  • Purchase protection and extended warranty.
  • Complimentary ShopRunner membership with free two-day shipping on eligible items.
  • Exclusive access to events such as Broadway shows, concerts and sporting events.
  • Terms apply.

To see rates & fees for American Express® Green Card please click here.

Read our review of the American Express® Green Card.

American Express® Gold Card

American Express® Gold Card

Apply Now

on American Express's secure site

Terms and Conditions apply

Rates & Fees

  • 35,000 Membership Rewards® Points after you spend $4,000 on eligible purchases with your new Card within the first 3 months.*

  • Earn 4X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery, and 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per year in purchases, then 1X). Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.

  • Up to $100 per year for incidentals*

Highlights
  • Earn 35,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 3 months.
  • Earn 4X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery.
  • Earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
  • Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • $120 Dining Credit: Earn up to a total of $10 in statement credits monthly when you pay with the Gold Card at Grubhub, Seamless, The Cheesecake Factory, Ruth's Chris Steak House, Boxed, and participating Shake Shack locations. This can be an annual savings of up to $120. Enrollment required.
  • $100 Airline Fee Credit: up to $100 in statement credits per calendar year for incidental fees at one selected qualifying airline.
  • No Foreign Transaction Fees.
  • Annual Fee is $250.
  • Terms Apply.
  • See Rates & Fees

See additional details for American Express® Gold Card

More Info

This card serves consumers who want valuable credits for dining and incidental airline fees, as well as generous rewards on dining, supermarket purchases and flights.

Rewards: Earn 4X Membership Rewards® Points on Restaurants worldwide, including takeout and delivery. Additionally, earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X), and 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.

Welcome offer: 35,000 Membership Rewards® Points after you spend $4,000 on eligible purchases with your new Card within the first 3 months.

Annual fee: $250

Additional benefits:

  • Up to $10 a month in statement credits for Grubhub, Seamless, The Cheesecake Factory, Ruth’s Chris Steak House, Boxed and participating Shake Shack locations.
  • Up to $100 annually in statement credits for incidental airline fees.
  • Baggage insurance plan.
  • Car rental loss and damage insurance.
  • Global Assist Hotline access when traveling more than 100 miles from home.
  • Benefits when staying at a property in The Hotel Collection.
  • Discounts and amenities by enrolling in The Travel Collection by Travel Leaders Group.
  • Use the Personalized Travel Service to book travel and make arrangements by phone.
  • Complimentary ShopRunner membership with free two-day shipping on eligible items.
  • Exclusive access to events such as Broadway shows, concerts and sporting events.
  • Take advantage of Amex Offers for shopping, dining, travel purchases and more.
  • Get access to premium seats and select events via the Preferred Seating benefit.
  • Terms apply.

To see rates & fees for American Express® Gold Card please click here.

Read our review of the American Express® Gold Card.

The Platinum Card® from American Express

The Platinum Card® from American Express

Apply Now

on American Express's secure site

Terms and Conditions apply

Rates & Fees

  • 60,000 Membership Rewards® points after you use your new Card to make $5,000 in purchases in your first 3 months.*

  • Up to $200 per calendar year in baggage fees & more at one qualifying airline*

  • No foreign transaction fees & exclusive airport lounge access*

Highlights
  • Earn 60,000 Membership Rewards® points after you use your new Card to make $5,000 in purchases in your first 3 months.
  • Enjoy VIP status and up to $200 in Uber savings on rides or eats orders in the US annually. Uber Cash and Uber VIP status available to Basic Card Member only.
  • 5X Membership Rewards® points on flights booked directly with airlines or with American Express Travel.
  • 5X Membership Rewards points on prepaid hotels booked on amextravel.com.
  • Enjoy access to the Global Lounge Collection, the only credit card airport lounge access program that includes proprietary lounge locations around the world.
  • Receive complimentary benefits with an average total value of $550 with Fine Hotels & Resorts® program at over 1,000 properties. Learn More.
  • $200 Airline Fee Credit, up to $200 in statement credits per calendar year in baggage fees and more at one qualifying airline.
  • Get up to $100 in statement credits annually for purchases at Saks Fifth Avenue on your Platinum Card®. That’s up to $50 in statement credits semi-annually. Enrollment required.
  • $550 annual fee.
  • Terms Apply.
  • See Rates & Fees

See additional details for The Platinum Card® from American Express

More Info

This card is geared toward frequent travelers willing to pay a lavish price for top-of-the-line benefits.

Rewards: 5X Membership Rewards® points on flights booked directly with airlines or with American Express Travel and 5X Membership Rewards® points on prepaid hotels booked on amextravel.com.

Welcome offer: 60,000 Membership Rewards® points after you use your new Card to make $5,000 in purchases in your first 3 months.

Annual fee: $550

Additional benefits:

  • Access to more than 1,200 airport lounges via the Global Lounge Collection.
  • Annual credit of up to $200 for incidental airline fees.
  • Fee credit of up to $100 for Global Entry, or $85 for TSA Precheck.
  • Uber VIP status and up to $200 annually in Uber Cash.
  • Benefits when staying at a property in The Hotel Collection.
  • Benefits when staying at a Fine Hotels & Resorts property.
  • Platinum Travel Service to help with custom itineraries and tailored recommendations.
  • Marriott Bonvoy Gold Elite status.
  • Hilton Honors Gold status.
  • Complimentary membership in the following car rental programs: Avis Preferred Club, Hertz Gold Plus Rewards and National Emerald Club.
  • Car rental loss and damage waiver.
  • Premium Global Assist Hotline access when traveling more than 100 miles from home.
  • Trip delay and trip cancellation insurance.
  • Up to $100 in statement credits annually for purchases at Saks Fifth Avenue.
  • Access to the Platinum Card Concierge.
  • Return protection, purchase protection and extended warranty.
  • Enjoy special access to restaurant reservations and experiences with the Global Dining Collection.
  • Get access to premium seats and select events via the Preferred Seating benefit.
  • Add a complimentary American Express® Gold Card to your account.
  • Terms apply.

To see rates & fees for The Platinum Card® from American Express please click here.

Read our review of The Platinum Card® from American Express.

Business Green Rewards Card from American Express

This basic business charge card is best for business owners who want a card for managing expenses, but one that also offers travel benefits and earns Membership Rewards points.

Rewards: 2 points per dollar on eligible purchases at amextravel.com and 1 point per dollar on eligible purchases.

Welcome offer: 3X Membership Rewards® points on your combined eligible purchases, up to the first $50,000, at U.S. restaurants, on hotel stays booked directly with hotels, and on airfare purchased directly from airlines in first 3 months of Card Membership.

Annual fee: $0 for the first year, then $95

Additional benefits:

  • Baggage insurance plan.
  • Car rental loss and damage insurance.
  • Global Assist Hotline access when traveling more than 100 miles from home.
  • Take advantage of Amex Offers for shopping, dining, travel purchases and more.
  • Terms apply.

Read our review of the Business Green Rewards Card from American Express.

American Express® Business Gold Card

American Express® Business Gold Card

Apply Now

on American Express's secure site

Terms and Conditions apply

Rates & Fees

  • Earn 35,000 Membership Rewards® points after you spend $5,000 on eligible purchases with the Business Gold Card within the first 3 months of Card Membership.

  • Get 4X Membership Rewards® points on the 2 select categories where your business spent the most each month*

  • No foreign transaction fees & many helpful business tools*

Highlights
  • Earn 35,000 Membership Rewards® points after you spend $5,000 on eligible purchases with the Business Gold Card within the first 3 months of Card Membership.*
  • MORE REWARDS: Get 4X Membership Rewards® points on the 2 select categories where your business spent the most each month. 1X is earned for other purchases. **
  • **4X points apply to the first $150,000 in combined purchases from these 2 categories each calendar year.*
  • AIRLINE BONUS: Get 25% points back after you use points for all or part of an eligible flight booked with Amex Travel, up to 250,000 points back per calendar year.*
  • PAY OVER TIME OPTION: A flexible payment option with interest to help manage cash flow on purchases of $100 or more.*
  • *Terms Apply
  • See Rates & Fees

See additional details for American Express® Business Gold Card

More Info

This charge card is best for business owners who want flexibility in the categories they’re rewarded for. The American Express® Business Gold Card has the unique feature of automatically detecting where your business spends the most, based on the following six categories:

  • Airfare purchased directly from airlines.
  • U.S. purchases for advertising in select media (online, TV, radio).
  • U.S. purchases at gas stations.
  • U.S. purchases made directly from select technology providers of computer hardware, software and cloud solutions.
  • U.S. purchases made at restaurants.
  • U.S. purchases for shipping.

Rewards: Get 4X Membership Rewards® points on the 2 select categories where your business spent the most each month*. The 4X rate applies to the first $150,000 in combined purchases for these categories each calendar year, then you’ll earn 1 point per $1 spent.

Welcome offer: Earn 35,000 Membership Rewards® points after you spend $5,000 on eligible purchases with the Business Gold Card within the first 3 months of Card Membership.

Annual fee: $295

Additional benefits:

  • Baggage insurance plan.
  • Car rental loss and damage insurance.
  • Global Assist Hotline access when traveling more than 100 miles from home.
  • Benefits when staying at a property in The Hotel Collection.
  • Discounts and amenities by enrolling in The Travel Collection by Travel Leaders Group.
  • Take advantage of Amex Offers for shopping, dining, travel purchases and more.
  • Book a flight using Pay With Points and get 25% of those points back.
  • Terms apply.

To see rates & fees for American Express® Business Gold Card please click here.

Read our review of the American Express® Business Gold Card.

The Business Platinum Card® from American Express

The Business Platinum Card® from American Express

Apply Now

on American Express's secure site

Terms and Conditions apply

Rates & Fees

  • Earn up to 75,000 Membership Rewards® points*

  • Complimentary access to over 1000+ airport lounges*

  • Get 50% more Membership Rewards® points. That's 1.5 points per dollar, on each eligible purchase of $5,000 or more*

Highlights
  • Earn 75,000 Membership Rewards® points after you spend $15,000 on qualifying purchases within your first 3 months of Card Membership.
  • Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com.
  • Get 50% more Membership Rewards® points. That's an extra half point per dollar, on each eligible purchase of $5,000 or more. You can get up to 1 million additional points per year.
  • Enroll to get up to $200 in statement credits annually by getting up to $100 semi-annually for U.S. purchases with Dell. Terms apply.
  • 35% Airline Bonus: Use Membership Rewards® Pay with Points for all or part of a flight with your selected qualifying airline, and you can get 35% of the points back, up to 500,000 bonus points per calendar year when you book on amextravel.com.
  • Terms Apply
  • See Rates & Fees

See additional details for The Business Platinum Card® from American Express

More Info

Business owners who are willing to pay a premium annual fee in order to get benefits, such as wide-ranging airport lounge access, travel protections and annual credits for airline fees and spending on Dell purchases do well by The Business Platinum Card® from American Express.

Rewards: 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com. Get 50% more Membership Rewards® points. That's an extra half point per dollar, on each eligible purchase of $5,000 or more.

Welcome offer: Earn 75,000 Membership Rewards® points after you spend $15,000 on qualifying purchases within your first 3 months of Card Membership.

Annual fee: $595

Additional benefits:

  • Access to more than 1,200 airport lounges via the Global Lounge Collection.
  • Annual credit of up to $200 for incidental airline fees.
  • Annual credit of up to $200 for U.S. purchases with Dell.
  • Fee credit of up to $100 for Global Entry or $85 for TSA Precheck.
  • Benefits when staying at a Fine Hotels & Resorts property.
  • Business Platinum Travel Service to help with custom itineraries and tailored recommendations.
  • Marriott Bonvoy Gold Elite status.
  • Hilton Honors Gold status.
  • Premium Global Assist Hotline access when traveling more than 100 miles from home.
  • Baggage insurance plan, trip delay insurance and trip cancellation and interruption insurance.
  • Complimentary membership in the following car rental programs: Avis Preferred Club, Hertz Gold Plus Rewards and National Emerald Club.
  • Car rental loss and damage insurance.
  • Get access to premium seats and select events via the Preferred Seating benefit.
  • Access to the Business Platinum Card Concierge.
  • Purchase protection and extended warranty.
  • Enjoy special access to restaurant reservations and experiences with the Global Dining Collection.
  • Take advantage of Amex Offers for shopping, dining, travel purchases and more.
  • Book a flight using Pay With Points and get 35% of those points back.
  • Terms apply.

To see rates & fees for The Business Platinum Card® from American Express please click here.

Read our review of The Business Platinum Card® from American Express.

The Plum Card® from American Express

The Plum Card® from American Express

Apply Now

on American Express's secure site

Terms and Conditions apply

Rates & Fees

  • Receive 1.5% discount for paying early*

  • Take up to 60 days to pay with no interest*

  • No foreign transaction fees & no fee for extra employee cards*

Highlights
  • Paying early pays off: get a 1.5% Early Pay Discount, with no cap on what you can earn back.
  • Take up to 60 days to pay with no interest, when you pay your minimum due by the Payment Due Date.
  • Use the power of the Plum Card to buy big for your business.
  • No Foreign Transaction Fees.
  • Introductory annual fee of $0 for the first year, then $250
  • Terms & Restrictions Apply.
  • See Rates & Fees

See additional details for The Plum Card® from American Express

More Info

The Plum Card® from American Express is good for business owners who need flexibility when managing their cash flow, rewarding you with cash back for paying early and up to 60 days to pay your balance without interest, as long as you pay the minimum payment due.

Rewards: Get a 1.5% discount when you pay early, with no cap on what you can earn back.

Welcome offer: None.

Annual fee: $0 introductory annual fee your first year, then $250.

Additional benefits:

    • Global Assist Hotline access when traveling more than 100 miles from home.
    • Car rental loss and damage insurance.
    • Take advantage of Amex Offers for shopping, dining, travel purchases and more.
    • Terms apply.

To see rates & fees for The Plum Card® from American Express please click here.

Read our review of The Plum Card® from American Express.

Brex For Startups

The Brex For Startups made its debut in 2019 for entrepreneurs who might have trouble accessing credit from traditional sources. Note that it’s a corporate card, meaning that it doesn’t require a personal credit guarantee — but its requirement that you must have at least $50,000 in a U.S. bank account to qualify could make it difficult for some business owners to qualify. Also, know that this card is not issued by American Express.

Rewards: Earn points on every dollar spent with industry-leading multipliers: 7x on rideshare, 4x on travel, 3x on restaurants, 2x on software subscriptions and 1x on all other transactions.

Welcome offer: None.

Annual fee: $0

Additional benefits:

  • Get discounts on business-related services from Brex’s partners, such as Amazon Web Services, Slack and more. Brex estimates these offers are worth $50,000 in value.

Read our review of the Brex For Startups.

Is a charge card right for you?

When evaluating whether a charge card or a credit card better fits your spending habits, consider the following questions:

  • Are you willing to pay an annual fee?
  • Do you have good or excellent credit?
  • Are you able to pay your card in full each month?
  • What kind of rewards are you looking for?
  • Where do you intend to use the card?

You’ll likely have to pay an annual fee for a charge card, whereas there are many no-annual-fee credit cards. And applicants generally need good or excellent credit scores to qualify for a charge card. People with no credit or bad credit should look at credit cards designed for building credit.

Having the ability to revolve a balance from time to time can come in handy when finances are tight, but with a charge card, that can become a little tricky as generally, the entire balance is due in full when the statement arrives. But that can be a good thing, too, as paying in full every month can prevent you or your business from racking up debt.

As to rewards, charge cards typically offer strong rewards and benefits. But just make sure they fit with your spending habits. For example, if you’re a heavy spender on gas, a credit card such as the Wells Fargo Propel American Express® card or the Bank of America® Cash Rewards credit card would be a better fit than any of the charge cards listed here.

Finally, bear in mind that American Express is the main issuer of charge cards. While Amex has worked hard to catch up to Visa and Mastercard as far as acceptance at merchants in the United States, there are still some destinations abroad where it’s not so widely accepted. For this reason, it may be wise to carry a Visa or Mastercard as a backup when traveling internationally.


Recommended Posts:

The History of American Express

Today, American Express® is the largest payments network in the world, but the company wasn’t always a credit card issuer. American Express was founded in 1850 as a freight forwarding company — in other words, a mail delivery company — and used their delivery services to establish trust with consumers. As the years progressed, Amex […]

Read More