Payback American Express – The Best Free Credit Card in Germany in 2024
How to double your Payback Germany points with an Amex credit card
Up until a few months ago, I never owned a credit card. For anyone coming from the US, this might seem weird, but for everyone in Europe, that’s not surprising. Instead of credit cards, we simply use debit cards connected straight to our bank accounts. Most European banks offer standard Mastercard or Visa cards that are accepted everywhere, offline or online. There are some exceptions like Germany and the Netherlands, where banks issue Maestro or V Pay cards that cannot be used for online payments.
The important thing is that Europeans don’t use and often don’t trust credit cards, as they come with interest and can have a negative influence on one’s money-spending habits. That’s the reason why I never got a credit card. I never felt comfortable spending money that I don’t have. What changed my mind? Charge cards.
In Germany, most big banks like Sparkasse, Commerzbank, Deutsche Bank, ING, etc. offer current accounts that can be additionally equipped with a credit card. But the German definition of a credit card is much closer to a charge card. That means that, instead of buying something on a long-term credit and paying interest over time, your bank account is charged monthly the amount you spent in a previous month. Usually, this happens automatically via direct debit, so there’s no way to miss the due date. This also means that, as long as you have enough money on your account, you never pay anything but the annual fee for having the card. Of course, there’s more to charge card than this (like no set credit limit).
Unfortunately, standard German bank-issued credit cards don’t really offer any benefits besides being able to rent a car, book a hotel or pay online (which can be done with Mastercard or Visa debit cards anyway). On top of that, as I just mentioned, banks tend to charge annual fees for using them, usually around €30. Hence why I never opened a traditional bank account in Germany and went with more modern N26, where I don’t pay anything and get both Maestro and Mastercard cards, free of charge.
But there are some credit cards on the German market that, first, won’t cost you anything or will offer great benefits for an annual fee, and second, will allow you to collect points or even cashback. This long-ish introduction leads me to the Payback American Express – a credit card that you should get if you live in Germany.
What’s Payback?
Before we talk about the card itself, it’s good to understand what’s Payback and how it is different from other credit card points programs, such as American Express’ Membership Rewards.
Payback is the biggest couponing platform in Germany. It allows you to collect points for purchases at partner stores, such as Rewe, Penny, and dozens of others. Usually, €2 spent equals 1 Payback point, but with coupons and extra vouchers, you can multiple how many points you’re going to get by factors of 5, 10, and sometimes even 33. You can even collect points for online purchases at selected stores, including Lieferando (Takeaway.com), eBay, Disney+, Apple, and many, many more.
1 Payback point is worth on average €0.01, and you can spend them in a few ways. First, you can exchange them for rewards in Payback’s own store, which can be an easy way to get gift cards to things like App Store, Google Play, IKEA, etc. You can also exchange Payback points for miles in the Miles & More programme. By default, 1 point equals 1 mile, but I saw offers for an additional 25% in value. Last but not least, there’s a hidden option to simply cash out the points to a bank account. This effectively makes Payback a cashback programme, where you can earn at least 0.5% on purchases at the partners. I know that it barely compares to what credit card companies in the US where you can get 5% cashback on some purchases, but it’s really not that bad considering that merchant fees in the EU are limited to 0.2% for debit cards nad to 0.3% for credit cards.
If you would like to learn more about Payback and maximizing your points earning, check this article.
What’s Payback American Express credit card?
American Express, besides having its own Membership Rewards programme, happens to own Payback. As a result, besides their standard Platinum, Gold, Green, and Blue cards, they also offer a Payback card in selected markets. The card has no annual fees and earns you 1 Payback point for every €3 spent. Not only does it double your Payback points, but it also allows you to collect them everywhere where American Express cards are accepted. Owning the card also allows you to save the points from expiring, similarly to how it works with programmes like Miles & More.
The card also comes with a few other benefits that you’d expect from an Amex card:
- 90-day return window for purchases up to €300
- Access to Amex Offers (although it seems to be quite limited compared to other Amex cards)
- 4,000 points as a signup bonus (the standard offer is only 1,000 points)
- 1000 points for referring a friend (there’s an ongoing offer where referee gets 4,000 points and the referrer 2,000. You can use my link if you’re interested)
- Access to American Express Experiences platform
- Apple Pay and Google Pay
Similarly to other American Express cards available in Germany, the Payback card is a charge card. During the signup process, you will need to provide an IBAN number of your bank account which will be used for direct debits. This, combined with no annual fees and extra Payback points for every purchase, made me sign up for the card. I feel safe knowing that I won’t be charged any interest fees.
It’s important to note that the card doesn’t have a typical limit that other credit cards usually have. Instead, American Express adjusts the limit based on your spending habits. If you’re planning a bigger purchase, you can check in the Amex app if the transaction would be approved. In case it wouldn’t, you can always call them, and they will most likely raise your limit. So far, I called them only one time, but it was possible to do it in English, at least after selecting the right topic using the dial pad.
Disadvantages of the Payback American Express card
As much as I like the Amex card, there are a few cons to it. The most notable one is the fact that it’s an American Express card. In Berlin, there are still many places that either don’t take cards at all or accept only debit cards like Girocard, V Pay, and Maestro, including post offices and other public authorities. It shouldn’t be a surprise that they don’t take Amex cards since you’re not even able to pay with a Mastercard or Visa there. Some stores accept every card (including Diners Club, JCB, and UnionPay) but American Express. That’s most likely due to high merchant fees that Amex – unlike Visa and Mastercard – can still charge despite the cap put by the European Union in 2016. I’m still able to pay with the card in most places, and if I can’t, I will just use my Eurowings Premium Visa credit card.
Another downside to the Payback Amex card are high ATM fees, which are not that uncommon for credit cards. In the case of German Amex cards, the fee is 4% with €5 minimum. There is also a 2% fee on payments in foreign currencies, which makes the card not the best option for travelling outside of the Eurozone. Payback, in collaboration with BW Bank, offers another credit card that doesn’t have these fees, but it’s not possible to pay it back in full via direct debit (the bank subtracts only 10%) and the card collects only 1 Payback point per €5 spent. Therefore for travel, I’m going to stick to Eurowings Premium Visa credit card or Revolut.
Should you apply for Payback American Express?
If you live in Germany and collect Payback points – definitely. If you live in Germany and don’t collect the points yet, you really should start. It allows you to save a decent amount of money on everyday purchases and even on things like fuel and electronics. Without paying too much attention to the points last year, I managed to collect almost 2,000 of them, which is €20. Now, when I started activating coupons in the Payback app and using it for online purchases, I collected almost 9,000 points, just in two months.
The Payback American Express card allows you to save even more with Payback and saves your points from expiring. On top of that, it offers you some of the benefits of Amex’s premium cards, like 90-day return policy. I think it’s a great card for anyone thinking about getting their first credit card or wanting to collect extra points or miles.
Looking for a more premium credit card? Read my review of the American Express Platinum card with benefits worth over 760€.
