American Express, Chase set a new precedent for credit card fees

In many cases, when a market leader in a category raises prices, that clears the way for similar increases from its rivals.

When Costco raised its membership fees in Sept. 2024, for example, and did not see a drop in membership, that cleared the way for Sam’s Club to do the same this year.

The pattern is consistent. When a market leader raises prices without losing customers, it often resets the ceiling for an entire industry.

“The single most important decision in evaluating a business is pricing power,” Warren Buffet told the Financial Crisis Inquiry Commission in 2010.”If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business. And if you have to have a prayer session before raising the price by 10%, then you’ve got a terrible business.”

Across industries, pricing leadership often functions less as isolated decision-making and more as a signaling mechanism that competitors quickly incorporate into their own pricing and product strategies.

Raising prices allows rivals to raise prices

That’s a practice that has long been the case in the wireless phone space, although precedent has sometimes worked in favor of consumers.

T-Mobile, for example, dropped contracts in 2013, and AT&T and Verizon had to follow not long after.

In fact, T-Mobile made a series of “Un-Carrier” moves like dropping overage charges, offering unlimited text and calls, and offering prices that include taxes and fees, which its chief rivals had to follow.

That’s often true in the credit card space as well.

“Offers get honed through the year… When Chase does something, Citi reacts. Or when Amex amps up an offer, Bank of America antes up,” Brian Riley, director of credit payments at Javelin Strategy & Research, said in industry commentary on credit card competition.

Generally, however, when a company makes a move that its competitors all follow, that usually does not mean good news for consumers.

That’s why American Express raising the fee for its high-end Platinum card, and not seeing that hurt adoption, may pave the path for rival credit card companies to do the same thing.

American Express raised the fee for its premium card

Companies rarely raise prices without trying to sell consumers that they’re actually getting more value for their dollars. That’s what American Express did in late-2025 when it raised the fees for its Platinum card from $695 to $895.

“U.S. Consumer Platinum Card® Members can now access over $3,500 in annual lifestyle benefits, including new credits on eligible purchases with Resy, lululemon, Uber One Membership, and enhancements to existing hotel and digital entertainment credits,” the company shared in a press release.

The company defended the price increase to the Associated Press.

These perks are enough to justify the $200 increase in the annual fee, Howard Grosfield, group president of U.S. Consumer Services at AmEx told the AP.

The annual fee on the Platinum Card was $550 just five years ago.

“What we are trying to do is two things: We want to make sure we are delivering $3,500 in benefits that are far, far in excess of the $895 fee and make it easy to find multiple ways for card members to find benefits that exceed that fee,” Grosfield said.

American Express’ plan has worked

When a company raises a fee on a product that renews annually, that gives it the option to make changes if the early numbers are not good.

Costco has acknowledged that if it ever raised membership fees and saw a customer backlash, it would be able to adjust in real time. That did not happen with its most recent membership price hike.

“Importantly, about 1/4 of the overall U.S. consumer Platinum portfolio has been billed for the higher annual fee, and we have seen no change to our very high retention rates relative to pre-refresh,” CFO Christophe Le Caillec said during the company’s first-quarter earnings call.

Revenue from Platinum cardholders grew by 6% in Q1, which CEO Stephen Squeri talked about during the call.

“The majority of that, given the size of the portfolio, is coming from tenured card members. Although we’re very pleased with new account acquisition, the majority of that 6% lift is coming from the back book,” he added.

American Express wants to drive people to the Platinum card

Back when I traveled multiple times per month for business and personal reasons, I found the American Express Platinum an invaluable tool. Access to airport lounges may not have actually justified the membership fee, but the value of having a clean place to work with outlets, an open bar, and decent bathrooms was hard to put a price on.

Now that I travel by plane far less, I no longer carry the American Express Platinum, but that wasn’t due to the price increase. It was much more because the core benefits of the card are tilted toward airport and hotel perks, and I simply don’t need those as much anymore.

View From the Wing’s Gary Leff laid out American Express’ strategy on his travel website.

“Increasingly, annual fees are a material part of the revenue they earn. The best cards give back the revenue generated from spending to the customer, but the flat fee for the card is growing, and consumers are paying it,” he noted.

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That’s a strategy other credit card companies use as well.

“Offering an attractive card with benefits is increasing spending, and keeping more of that spend inside their own ecosystem. Amex pushes people to their own travel platform and to Resy which they own. Chase pushes their cardmembers to Chase Travel (and away from Expedia and Airbnb) and also to the Shops with Chase, although the experience there leaves something to be desired,” he added.

The Platium is one of American Express’ top-tier cards.

Shutterstock

American Express, Chase create a new precedent

Changing views toward fees has helped American Express justify the price hike.

“Analysts say younger generations, which make up a significant share of AmEx cardholders, are more comfortable paying credit card fees, viewing them as subscription-like products that deliver value through travel, dining, and entertainment experiences,” Reuters reported.

Axios noted that American Express has been at the tip of the spear in a wave of credit card fee hikes, but Chase actually set the precedent with its price hike for its premium card.

“The fee for the Chase Sapphire Reserve card increased to $795 a year from $550,” according to Axios, which added that “It’s not just credit card companies catering to higher-income groups.”

Airlines, the site reported, “are increasingly open about targeting their top spending consumers, with Delta increasing perks for its top spending travelers and JetBlue openly working to target higher earners.”

Analysts and industry reporting suggest American Express’s latest Platinum fee increase reflects a broader shift toward premium, high-fee credit cards, with added perks used to justify pricing and potentially set a new benchmark for competitors targeting affluent customers.

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