The American Express Essential Credit Card is the base level card issued by American Express in the Australian Market. This card will appeal to those who want to kick off their points and miles journey, but don’t wish to pay hundreds of dollars per year in fees on more premium cards.

The Essential card earns uncapped 1.25 Membership Rewards points per $1 on all spends, except on payments to Government bodies, where it earns 1 point per $1. This isn’t a lot, but is better than several Visa & Mastercard issued cards which don’t earn any points on Government spend.

Prominent Features & Fees

• Annual Fee – $0, Foreign currency transaction fee – 3%
• Welcome Bonus – $100 credit
• Rewards Program – Membership Rewards
• Airline Partners : 9
• Hotel Partners : 2
• Travel agency partner, Retailer and Gift Cards
• Insurance – Smartphone screen insurance up to $500 per year, Buyer’s Advantage, Refund and Purchase Protection

Annual Fee

The Essential card is a no annual fee card, which is pretty good for a rewards card. Most of the other rewards card in the Australian market charge some degree of annual fee, which makes this card stand out.

There is a 3% foreign currency transaction fee though, which is applied to the converted Australian dollar amount.

Welcome Bonus

Ordinarily, the card does not offer any welcome bonus. For a limited time though, new cardmembers can earn a $100 credit. To get this:

• You must Apply for the card online and be approved.
• Spend a minimum of $2,000 on the card within 3 months of your card membership.

The $100 will be credited back to you as a statement credit, meaning Amex are actually paying you money to sign-up for the card. Promotions like these are not uncommon in places such as United States, but are virtually unheard of in Australia which makes this offer so much more special.

Like most American Express cards, you are NOT eligible for the welcome bonus if you currently hold or have held within the last 18 months, any directly-issued American Express card. However, those holding The David Jones American Express Card or The David Jones American Express Platinum Card, or those with a bank-issued American Express card, will receive the welcome bonus upon meeting the minimum spend criteria.

Disclosure : If you apply for this card using links in this post and are approved, pointsHq or it’s related entity may receive some referral points.

Rewards Program

American Express offers several cards in the Australian market that come with their own Membership Rewards program. Whilst all these programs share some common traits and benefits, there are some differences too.

The American Express Essential Credit Card participates in the standard Membership Rewards program, under which you earn 1.25 Membership Rewards points per $ spent on most purchases, except where the payment is made to Government bodies such as the Tax Office, Local Councils, Service NSW centres etc, where you earn 1 Membership Rewards point per $.

Although it is not ideal to have a lower earning rate on these payments, it’s worth remembering that there has been a crack-down on payments to Government bodies over the year, to the extent that on majority of non-American Express cards, you earn no points.

Airline Partners

The Membership Rewards program has 9 airline partners. This includes Virgin Australia but not Qantas. The partners are :

• Virgin Australia – Velocity Frequent Flyer
• Singapore Airlines- Krisflyer
• Cathay Pacific – Asia Miles
• Emirates Skywards
• Etihad Guest
• Thai Royal Orchid Plus
• Malaysia Airlines Enrich
• Air New Zealand Airpoints

In all cases except Air New Zealand, Membership Rewards points transfer to the respective airline program at 2:1, giving you an effective earning rate of 0.625 airline points/miles per $.

The transfer ratio for Air New Zealand is 200:1 Airpoints dollar. Unfortunately, the transfers are not instant and it takes anywhere between 1 (Virgin Australia) to 7 (Etihad) days for the points to be deposited into your frequent flyer account.

Hotel Partners

The 2 hotel partner programs associated with Membership Rewards program is Marriott Bonvoy and Hilton Honors. Membership Rewards points transfer to Hilton at 2:1 and to Marriott at 3:2

You can transfer Membership Rewards points to Hilton Honors program for a stay at Hilton Queenstown

In both cases, the transfer rates are below par and unless you have more points than you can count, they are best utilised towards premium cabin redemptions on partner airlines. If you do plan to transfer and redeem points for hotel stays with Marriott, take a moment to read my review of the Marriott Bonvoy Program and step by step instructions on redeeming points.

Travel Agency partner, Retailer & Gift cards

The American Express Membership Rewards point can also be redeemed for booking travel through ‘Hello World’, online shopping at ‘David Jones’ or on one of the many gift cards ranging from Coles and Woolworths to Rebel Sports and Priceline Pharmacy.

As is the case with hotel partners, redemption with these partners too, offer less than optimum value and must be carefully considered before proceeding through with it. For each of the partners, you can redeem 20,000 Membership Rewards points for a $100 gift card.

Redeem Membership Rewards points for gift cards with its retail partners

Insurance

The American Express Essential Credit Card provides a range of insurance protection:

Smartphone Screen Cover

This is by far the most valuable feature of The Essential card given it’s not widely offered, and is only available on select credit and charge cards which come with hundreds of dollars in annual fee.

When you pay for your smartphone outright, or through a monthly payment plan with your Essential credit card, it covers you for any accidental damage to the screen of up to $500 per year. A 10% excess applies to each claim with a maximum of 2 claims per year permitted.

I got a chance to test out this feature earlier in the year, when I accidentally dropped my phone and broke the screen.

My shattered iPhone 🙁

Luckily, I had access to this cover through my American Express Explorer Card. The total cost for getting the screen replaced was $140, which was reimbursed by American Express (after deducting a 10% excess).

Buyer’s Advantage

This is a handy cover that comes with the card. The easiest way to explain this, is that it provides extended warranty on products purchased and paid for by the Essential credit card, over and above the warranty provided by the retailer. Upon successful claim, American Express will, at its discretion, repair, rebuild, or replace the defective or broken-down product, or pay you an amount to do so.

For warranty periods of less than 1 year, it adds a warranty period of the same length to the purchase. For example, if the product purchased has a warranty period of 6 months, at its expiry, American Express will extend it for a further 6 months. For warranty periods of between 1 and 5 years, you get extended warranty, or ‘The Buyer’s Advantage period’ as American Express calls it, of another year. There is no cover for products that come with original warranty of more than 5 years.

Purchase Protection

Under Purchase protection, you are covered for up to $10,000 per year and up to $2,500 per claim ($50 excess applies) on items stolen or damaged within 90 days of purchase. To activate this cover, you must have paid for your purchase with The Essential card.

Refund Protection

This is another useful cover to have for situations where you have simply had a change of mind after the purchase, and for whatever reason, the retailer will not take it back. Under these circumstances, items paid for by the Essential credit card can be returned to American Express, who will reimburse you with an amount specified under the terms of the cover.

There are conditions attached to each of these cover and it’s important that you familiarise yourself with them by referring to The Essential Credit Card Product Disclosure Statement.

Who can apply?

This brings us to the last but an important question, who can apply for this card?

You are eligible to apply for this card if you meet the following conditions:

• You are at-least 18 years old.
• You are an Australian citizen, permanent resident or on long term visa. (1 year or over).
• You have a before tax income of $40,000 or more.
• You have a good credit history and no payment defaults.

In Conclusion

The American Express Essential Credit Card is NOT targeted at advanced points collectors. There is no welcome bonus by the way of lump sum points, which is understandable for a no annual fee rewards card. The regular earning rate is respectable but nowhere near industry leading.

The smartphone screen protection cover is undoubtedly the no. 1 attraction with this card. Like all American Express cards, The Essential also comes compatible with both Apple Pay and Samsung Pay.

If your intention is to rack-up hundreds of thousands of points in a short period of time, this card won’t do that. However, if you are someone who wish to slowly establish their feet in the points and miles universe, but don’t want to shell-out for the privilege of doing so, this card should be in your consideration.

Apply here to be taken directly to the American Express website.

Disclaimer

The views expressed in this post is author’s personal opinion, it does not constitute advice of any kind and must not be relied on. You must assess your own personal circumstances and needs before applying for this product.

pointsHq or its related entities are not authorised credit representatives and will not be responsible for losses arising from any actions taken, as a result of views or opinions expressed here.