American Express is casting a wider net for credit users with a new card for small-business owners.
Unlike its other two cards aimed at this market, the green Small Business Corporate Card and the gold Executive Corporate Card, launched in 1987 and 1991 respectively, the new product inhibits cardholders' spending with a defined credit limit.
The new entry, the Pre-Set Line Card, is designed to deliver credit to businesses that wouldn't normally qualify for an American Express card because they lack longevity and established credit records.
In past programs "we were limiting the population of small businesses to what we felt comfortable with," said Steven W. Alesio, executive vice president of American Express' small-business services.
Mr. Alesio said the Pre-Set Line Card is comparable to a secured credit card for consumers, in that it targets customers that are considered more risky.
In another parallel to secured cards, American Express Pre-Set customers will be able to increase their credit lines and eventually graduate to standard small-business cards if they pay their bills promptly.
Credit lines for the new charge card begin at $500 and the annual fee per card is $55.
The card comes with the same enhancements as the green Small Business Corporate Card except for the Express Cash feature, which allows cardholders to withdraw money from their checking accounts.
The Pre-Set Line Card has been promoted by direct mail and telemarketing since June, but Mr. Alesio declined to reveal how many such cards American Express has or expects to issue.
More than 1.5 million organizations are using American Express' Small Business Corporate Cards.
American Express cards of all kinds total 26 million in the United States and 37 million worldwide. Both figures rose 3.6% between Dec. 31 and June 30.
"We have been a leader in the small-business market, and our intention is to maintain that position going forward," said Mr. Alesio.
A recent national survey conducted by Cicco & Associates Inc., a market research firm in Murrysville, Pa., cited American Express as being responsive to small-business needs.
The survey asked small-business owners to produce the names of companies that are particularly sensitive to their needs, and for the past five years American Express has ranked either No. 1 or No. 2.
