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American Express Serve: the Best Prepaid Debit Card Around?

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Prepaid cards have surged as a popular alternative payment method for people who are “underbanked,” with limited access to traditional financial institutions, or have bad credit. The problem is that most of the cards are expensive, carrying many fees. Not so with the American Express Serve. It has some of the lowest fees in the prepaid market and offers a slew of benefits.

But while the American Express Serve is one of the best prepaid cards around, it’s not for everybody. We’ll dig into what the American Express Serve offers and explore another option that may fit your needs.

How the American Express Serve adds value

In August 2015, American Express launched the Serve FREE Reloads and the Serve Cash Back, the latter being the first rewards prepaid card in the industry. All three cards stand out in a market segment packed with fee-laden cards. Here is a comparison of the cards’ fees and benefits as of August 2015:

Fee American Express Serve American Express Serve FREE Reloads American Express Serve Cash Back
Card purchase $0 online, up to $3.95 in retail locations
Monthly fee
(no fee in NY, TX or VT)
$1, waived with direct deposit of at least $500 during the month $4.95 $5.95
Card reload Up to $3.95, depending on retailer $0 at CVS, Family Dollar, Walmart and participating 7-Eleven locations Up to $3.95, depending on retailer
Rewards None None 1% cash back on all purchases, to be redeemed on future purchases made with the card
Mobile check deposit, direct deposit or checking/savings transfer $0
ATM withdrawal $0 at MoneyPass ATMs, $2.50 at non-MoneyPass ATMs
Online bill pay $0
Send and receive money to other Serve cardholders $0
Foreign transaction fee 2.70%

Serve cards also boast the following features:

  • Subaccounts for family members; American Express allows you to monitor activity and set withdrawal limits
  • FDIC insurance
  • A linked savings account so you can set aside money for future financial goals
  • Purchase protection
  • Access to Amex Offers, a program that lets you save on shopping, dining and more

The American Express Serve, Serve FREE Reloads and Serve Cash Back are relatively light on the fees and heavy on the perks. They do require a Social Security number to open an account to verify your identity, but American Express doesn’t perform a credit check.

If you’re thinking about applying for the card because you have bad or no credit history and can’t qualify for a credit card, keep in mind that prepaid cards like the Serve don’t help you build credit because it doesn’t have a credit line. For that, you may be better off with a secured credit card.

The American Express Serve vs. a secured card

You can check out NerdWallet’s best secured credit cards to see some of the top secured cards, but here’s one to compare with the American Express Serve:

Digital Federal Credit Union Visa Platinum Secured Credit Card Credit Card
Apply Now

on Digital Federal Credit Union's
secure website

The Digital Federal Credit Union Visa Platinum Secured Credit Card is a Nerd favorite because it offers people with bad or no credit a way to rebuild their credit without punishing them with high interest rates and fees. The ongoing APR is 11.5% Variable — low for any credit card, let alone one designed for bad credit — and the annual fee is $0.

The card also charges no balance transfer fee — perfect if you’re carrying a balance on a high-interest card — and no cash advance fees, which is almost unheard of. Digital Federal Credit Union also reports your activity to all three credit bureaus, giving you a chance to establish good credit history and improve your chances at getting approved for a better card or a loan with a lower interest rate in the future.

The downside to the Digital Federal Credit Union Visa Platinum Secured Credit Card — or any credit card for that matter — is that you’ll pay interest if you carry a balance from month to month. The Nerds generally recommend that you pay off your balance on time and in full to avoid interest. Also, the Digital Federal Credit Union Visa Platinum Secured Credit Card doesn’t offer rewards like the Serve Cash Back, and you have to be a Digital Federal Credit Union member to apply, although the eligibility requirements aren’t strict:

  • Someone you are related to is a current member
  • The company you work for or retired from is a participating employer
  • You belong to a participating organization
  • You live, work, worship or attend school in a community which has been designated as underserved and the credit union has a branch in it

Is the American Express Serve right for you?

You still may want to choose one of the Serve cards over a secured credit card in certain situations, including if you have a teenage child or elderly parent you’re supporting who might need a subaccount, you don’t have a Social Security number or you simply don’t want to deal with credit cards. If none of these cases apply and you plan to pay your balance in full every month, you may be better off with a secured card like the Digital Federal Credit Union Visa Platinum Secured Credit Card.

Ben Luthi is a staff writer at NerdWallet, a personal finance website. Twitter: @benluthi.

Image via iStock.

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  • Paul Michael Carr

    I have had my serve card for about 6 months and I really do love it. I am able to send and receive money with family easily, get direct deposit, its inexpensive and they have really great customer service. I highly recommend it.

  • katina

    I agree with you completely i have similar problem i had my tax refund put on my serve card and when i tried to pay off some of my bills i found out that no one excepts AE OR SERVE . i tried to transfer funds to another prepaid card that i have and they wouldnt do it so my electricity was turned off. Thanks to serve and bills here paid late. Its my money and i feel that if i want it then no one has the right to keep it from me i earned that money not serve

  • Yelena Milskaya

    I had this card for a coupe of months now and I must say it was a mistake to get it. Yes, reloading the card is somewhat easy – Seven Eleven etc… But if you try to do something advanced, like getting a money transfer from someone not in the Serve system, you’ll be disappointed. No such option exists. The Direct Deposit option is no good for this (and frankly, it wasn’t any good for my employer, who refused to do a Direct Deposit because “Serve” is not a “real bank” and their direct deposit info is not accepted by most corporations when it comes to payroll). So, if you are looking for a truly versatile prepaid card, keep looking!

  • mattvorwald

    Keith, no. I had the permanent card. Amex Serve cancelled $2400 worth of bill payments I had requested without notifying me in any way. Then they forced me to wait 10 business days before opening a dispute. It took 3 hours on the phone once they would finally discuss opening a case. At this point they are telling me someone will contact me in 3-5 business days to discuss the case. Meanwhile I don’t have access to my money, and my landlord doesn’t have the check that was my rent. Amex Serve customer service is possibly the worst of the worst when it comes to anything financial. Never had any experience like this before with any bank. They are fully incompetent, and people should rightly steer clear of the train wreck.

  • IrishMama

    This is the WORST card ever. They allow you to load up to $100,000 a year and spend $100,000 a year. However, you CANNOT spend more than $15,000 a month. Once you hit that limit they won’t give you any more money from YOUR account. So I used it for travel and got a bonus added to it. Now that I got my paycheck direct deposited I need to get my money transferred to my bank. Nope! Not this month! They are holding my money and will not allow me to withdraw it from my account until April1! BS! Don’t ever do business with American Express they are theives.

    • Mia

      I can’t wait to see how it feels to be pissed off because I have reached my spending limit of $15,000.00 a month.


    lol The “demon of the desert” gives instruction on where to get your money.

  • ChristyandKeith Fobert

    I agree I got my card back in November 2014, and have had no issues with it… I had my tax refund deposited to the card and had no issues there … Customer service has been very helpful

  • Mia

    I use this card in lieu of my credit cards or cash. I got the Amex Serve to keep my spending habits under control. It’s great for booking hotels, spa appointments, and especially reacquiring monthly debits such as gym memberships. I use the Serve Card to keep from having my credit cards being kept on file. The recent credit card security breaches at major retailers and companies has made me rethink allowing my credit card information being kept on file.

    I feel more in control of my finances. Since identity theft is the crime of choice, I feel more secure using the Serve Card because I preload what I will use or what is needed at the time of purchase. I do not substitute the card for a checking account. I do not load large sums of cash or have direct deposits post to my card. There is nothing wrong with that but do your homework. Understand how to use the card. Before making purchases make sure they accept Amex. As far as the limitations I am reading about regarding atm withdrawals, making purchases, and money withdrawals all financial institutions have a withdrawal and purchase limitations for your protection to prevent fraud.

    As for the atm fees I’m reading about. My bank has a fee if I use the atm at any location other than theirs. The other institution will charge a fee as well. From what I am reading I think there is a lack of understanding of what the Amex Card is, how it works, and how it should be used.

  • Adam Johnson

    Worst customer service I have ever experienced. They would not approve me to connect my external checking account to transfer funds because I don’t have a US passport or drivers license. I closed the account with zero funds in it. Support agents were rude, unhelpful and not aware of the card policies. To speak to a supervisor you have to wait up to 48 hours. I strongly do not recommend.