August 19, 2009:  JPMorgan Chase & Co., the largest U.S. credit card issuer, is taking aim at  American Express by introducing a new card targeting the affluent.

Chase Sapphire, for household incomes exceeding $120,000, features no pre-set spending limit and points for each dollar charged. Chase is seeking customers beyond its 152 million cards issued in North America.

The new product introduction is seen as a means to avoid cannibalization of existing Chase card holders.

The Sapphire card will be available as both a Visa and as a MasterCard.   American Express Cards are accepted at 4.6 million U.S. locations, while Visa is accepted at 8 million and MasterCard at 7.9 million locations, according to industry newsletter, The Nilson Report.  As such, The Chase Sapphire should have a competitive advantage over AmEx.

According to American Express CEO Kenneth Chenault , AmEx cardholders on average spend 3.5 times more than Visa cardholders and 4.5 times more than MasterCard users.  If the Sapphire Card is successful in attracting AmEx customers, then Chase should be successful in boosting revenue, which otherwise is not expected to return to profitability until 2011.