Revolution Money To Be Part of American Express

When I read the news this morning that American Express is paying $300 million to buy Revolution Money, the first thing came into my mind was “What will happen to Revolution Money Exchange once it becomes part of a big business that doesn’t usually offer free services?”

I first knew Revolution Money more than two years ago when it launched a credit card, the RevolutionCard, which it claims can better protect cardholder’s identity by not printing name and account number on the card. I don’t know whether that claim has been proven or not, but I wasn’t very impressed by the card so I never thought about getting one. Then in early 2008, Revolution Money introduced another product, called Revolution Money Exchange, to compete with Paypal in the payment service business. This time, I jumped in and got an account for myself. Unlike the RevolutionCard which I don’t see any direct benefit to myself for using it, the Revolution Money Exchange has a very attractive feature: It doesn’t cost anything to send money between account holders. I don’t make a lot of money transfers online, except between my own bank accounts, but I don’t like that when somebody pays me $15 via Paypal, I only get, say, $14. What Revolution Money Exchange provides is exactly what I am looking for: No fee money transfer, though it doesn’t have the massive customer basis (Revolution Money has 400,000 consumers) as Paypal does.

Now that American Express is acquiring Revolution Money, I am wondering whether AmEx will keep Money Exchange free of fees for individual consumers.