American Express announces pilot card application experience, offering risk-free card approval

Today, American Express has announced a new application experience in which select Amex card applicants can be approved for a U.S. personal card with no immediate impact to an applicant’s credit score.

This is a big step toward application transparency, giving many potential Amex cardholders the safety blanket of an initial soft credit check. With approval, should the applicant accept the card, Amex will perform a hard credit check, as is typical with most rewards credit cards.

Unlike preapproved offers, this approval experience lets applicants know with “with 100% certainty if they are approved” — and there’s no additional information to submit after receiving the decision.

“We know that consumers value transparency and certainty,” says Sara Milsten, American Express executive vice president of U.S. consumer marketing. With the new application experience, prospective cardholders can apply for a specific Amex card and know if they’re approved — without having to worry about whether their application will change their credit score until they accept the card.

“We hope this new, more transparent application experience encourages anyone with an interest in American Express membership to apply,” says Milsten.

How the Amex pilot application experience works

When you apply for a U.S. personal Amex credit card now, you will see a banner that says, “Apply with confidence” and “Know if you’re approved with no impact to your credit score.” Note that existing American Express cardholders are not currently eligible for this experience.

As you apply for your chosen card, Amex will perform a soft credit inquiry and inform applicants if they are approved. Given the nature of soft credit inquiries, there will be no impact to your credit score.

As mentioned, should you choose to accept your approval, a hard inquiry is performed, which may have a temporary impact on your credit score.

What this means for you

“Learning whether or not you’re approved for a card with only a soft inquiry (at least at first) is a consumer-friendly change,” says Bankrate senior industry analyst Ted Rossman.

According to Rossman, standard credit card applications can hurt your credit score in the short term by as much as five to 10 points. And as a rule of thumb, consumers should avoid any more than five hard inquiries within a two-year span.

Tools like Amex’s new pilot card application experience can help ease the worries of those interested in a particular credit card, providing risk-free approval odds. But Rossman is curious to know whether Amex will provide information on applicants’ potential credit limits and interest rates, as well — a perk offered by products like the Apple Card.

“Typically, card issuers don’t tell you this information until after you’ve applied and been approved, which can be another pain point,” says Rossman. With balance transfer credit cards, a cardholder’s approved credit limit is considered in relation to the amount of debt they need to transfer. “What if you want to make a $5,000 balance transfer, for instance, and you’re only approved for a $2,000 limit?”

Looking into the future

In the future, Amex is set to provide this application experience on its co-branded partners’ websites (think: Delta Air Lines and Hilton), as well as open it up to existing cardmembers looking to apply for another personal card from Amex.

Rossman is curious to see whether other major issuers will follow Amex’s lead. “I hope Amex’s decision will lead other issuers to be more transparent about the application process and the terms they’re offering,” he says.

*The information about the Apple Card has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.