NEW YORK - JPMorgan Chase & Co, the second-largest U.S. bank, launched a charge card for small businesses on Wednesday, entering a market long dominated by American Express Co.

In addition, the bank launched three new credit cards for small businesses -- offering rewards, cash back and large credit limits. The new cards come at a time when small businesses have experienced great difficulty obtaining new credit.

Unlike credit cards, charge cards have to be paid in full at the end of every month, reducing the risk of defaults at a moment when credit card losses are at record highs in the United States.

The new charge card, called Ink Bold, is the first charge card from JPMorgan Chase or from any other Visa Inc (V.N) or MasterCard Inc issuer.

We really believe we are starting to see a stabilization point in the economy, and there are going to be small-business owners that are going to be leading the U.S. out of this recession, Richard Quigley, president of Chase business cards, a division of JPMorgan Chase, said in an interview.

Quigley said small businesses each year spend almost $5 trillion on non-payroll expenses in the United States, adding that 70 percent of those expenses were paid with checks.

The move could help JPMorgan diversify its card business, in a time when credit losses and a new law limiting interest rates and fees are denting the division.

JPMorgan Chief Executive Jamie Dimon has estimated the bank's credit card business will not be profitable until 2011. In addition, Chase has forecast the new credit card legislation that will enter into effect in February could trim revenue by $500 million per year.

The charge card has no fee for the first year but carries a fee of $95 thereafter. The new credit cards for small businesses have no annual fee the first year and cost up to $60 thereafter.

In recent months, American Express, the largest U.S. credit card company by sales volume, has boosted its charge card business.

JPMorgan currently is the biggest issuer of Visa branded credit cards and the second-largest issuer of MasterCard branded credit cards. (Reporting by Juan Lagorio; Editing by Steve Orlofsky)

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