Page last updated at 06:12 GMT, Tuesday, 19 May 2009 07:12 UK

American Express cuts 4,000 jobs

An American Express sign
Small firms are more likely to miss card payments, the firm says

American Express is cutting about 4,000 jobs - approximately 6% of its global workforce - as part of a plan to save $800m (£521.6m) this year.

The move is in addition to the 7,000 job cuts it announced in October 2008.

The firm has large numbers of small business customers - and Amex said that these businesses were more likely to miss repayments than individuals.

The credit card firm is also suffering from a fall in consumer spending - as house prices continue to struggle.

Last month, American Express reported that profit in the first three months of 2009 had fallen by 63%.

As well as the job cuts, the company has also stopped management-level salary rises and has frozen recruitment.

Abuses

In the US, legislation is planned that would stop credit card issuers from imposing arbitrary interest rate increases and penalties.

Last month President Barack Obama told the US credit card industry to scrap unfair interest rate rises and to be more transparent and accountable.

He told bosses of 13 card issuers - including American Express - that he wanted to keep the credit card market but to "eliminate some of the abuses".



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