American Express said Wednesday it would eliminate monthly fees on its popular gift cards, a move that is likely to pressure its competitors to do the same.

The company’s decision, which takes effect immediately, goes further than legislation Congress enacted in the spring that would limit, but not eliminate, monthly fees on gift cards.

Alpesh Chokshi, president of American Express’s Global Prepaid unit, said gift cards were popular, but consumers often complained about the monthly fee that ate away at their balance. There were no monthly fees in the first year, but on the 13th month, American Express began charging $2 a month.

Mr. Chokshi said eliminating the monthly fee was now possible because the gift card business had enough scale to remain profitable without the fees. The company will continue to make money from the purchase charge, which ranges from $2.95 to $6.95, as well as from its share of transaction fees each time the card is swiped.