How a $4,000 Vet Bill Sparked Innovation at American Express

Whether it's a replacement laptop, outdoor patio furniture, or faulty car transmission, many people need or want to make larger credit card purchases they can't pay off at the end of the month and end up accruing interest. “Over a year ago, I had to take my cat to the vet for an unexpected and expensive surgery,” says one Card Member. “To be honest, I still don’t know if I’ve paid the bill off.”

Many crave the flexibility to pay for large purchases over time, but also want to avoid the pitfalls of debt. Others rely on debit or cash for small items—no one wants to accumulate interest on a cup of coffee, lunch with a friend, or box of Kleenex—but then miss out on valuable rewards.

American Express worked with IDEO to help them attract new customers by understanding what financially stable young adults wanted in a credit card. The team began by interviewing more than 120 millennials to understand their payment behaviors around debit and credit, and how they think about borrowing and spending.

One person described the monthly panic of receiving his bill—described as “statement shock”—and his habit of making multiple payments before his billing cycle closed to ease this anxiety. Others were wary of credit because of a large veterinarian bill or financial mistakes made in their 20s, and relied on debit because it felt safer than accruing a balance to pay off. Overall, the team learned that many consumers experience anxiety about paying their bills. And while financial products that offer more flexibility and control have been needed for years, they are especially valuable in times of economic uncertainty like today.

Based on this research, IDEO prototyped, iterated, and refined two concepts, with frequent feedback from users and the client. Called Pay It Plan It, this feature offers financially responsible consumers more transparency, confidence, and control.

Pay It allows Card Members to quickly pay for small purchase amounts under $100 with a few taps in the American Express mobile app. When that purchase shows up on their account, they can choose “Pay It” and still earn rewards on the purchase. This ensures Card Members can take advantage of rewards while lowering their monthly bill by paying for smaller items throughout the month.

With Plan It, Card Members can split up larger purchases of $100 or more—like an emergency trip to the vet or a new sofa—into equal monthly payments, with a fixed fee and no interest. When the purchase appears in their account, they can select “Plan It,” and will be offered up to three monthly payment plans, ranging from three to 24 months. Each plan comes with a fixed monthly fee and no interest. Card Members know exactly how much they have to pay each month, so there are no surprises. And if they pay the purchase off early, they no longer have to pay any future plan fees.

The design of Pay It Plan It did not come without challenges: Bill pay is critical, complex, and highly regulated. Pay It Plan It required a significant internal financial and technical investment, which was achieved after IDEO shared many of the emotional, compelling stories from credit card users with leaders at American Express.

The team worked closely with the American Express regulatory and digital teams to ensure compliance and seamless integration into the mobile app and website’s user experiences and interfaces. To heighten the sense of competence, control, and transparency for users, the designers focused on small interactions like status animations, proactive suggestions, and straightforward language. These interactions help Card Members anticipate upcoming payments and clearly understand Pay It Plan It.

The flexibility and control offered through Pay It Plan have earned American Express positive press, including a call-out in The New York Times for being among solutions that “make it easier for their customers to borrow money, and to manage their monthly cash flow.”

At first glance, design-led innovation may seem difficult to achieve in large, established organizations like American Express, operating in a highly regulated and deeply rational industry. But the IDEO and American Express team successfully found ways to introduce new behaviors like rapid prototyping, cross-discipline collaboration, and leading with emotional customer stories within the existing organizational culture and structure. American Express has since established a permanent Pay It Plan It team dedicated to evolving the feature. Made up of employees across departments, this points to a new and collaborative team structure for the company.

By seeking to understand the human behind the Card Member, American Express has transformed credit and financial services for the better, helping both to be defined by empathy, utility, and transparency.

Initially, the team set out to create a new credit card with the needs of young adults in mind. But IDEO and American Express realized that Pay It Plan It could be scaled across existing credit card products to ultimately benefit and attract more Card Members. Now, almost all U.S. American Express Consumer Card Members have access to Pay It Plan It through credit cards, co-branded cards, and the well-known Green, Gold, and Platinum Cards. Since launching in 2017, Card Members have created nearly 5 million Plans, totaling nearly $4 billion in purchases, with an average Plan size of $789. Millennial and Generation Z Card Members have created approximately 44 percent of these Plans.