Why do merchants accept american express

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You should consult your own attorney or seek specific advice from a legal professional regarding any legal issues. Please understand that Experian policies change over time. Posts reflect Experian policy at the time of writing. However, it could be worth it to run the numbers or even a trial run. Some small businesses, depending on prices and clientele, can benefit greatly from accepting Amex. It might even be your favorite!

Many Amex cardholders do have a second credit card, whether Visa or Mastercard, as a backup. Of course, you can also use cash or a debit card, whatever works better for you and your finances. Update : Have more financial questions? SmartAsset can help. So many people reached out to us looking for tax and long-term financial planning help, we started our own matching service to help you find a financial advisor.

As a shopper, may have heard the phrase, "I'm sorry, we don't take American Express. The main reason: Compared with the other payment networks, AmEx tended to charge merchants higher interchange fees , aka "swipe fees. This varies depending on multiple factors, including card type, merchant type , and transaction volume and value. Unlike with debit card interchange fees, which are capped, federal law does not regulate or limit credit card swipe fees.

They are typically set by the payment networks, and American Express in the past has been more expensive for merchants to accept, with swipe fees as much as one percentage point higher than the competition as recently as That may not sound like much, but it can make a big difference for small businesses operating on extremely thin margins.

Not coincidentally, small businesses often were precisely the kinds of places that didn't accept AmEx — until recently. In a shift from the traditional system, those payment processors set the swipe fee rates they charge businesses, so merchants can shop around for a more competitive rate.

It certainly seems to be making a difference. Amex still has work to do before it completely closes the acceptance gap with Visa and Mastercard, but programs like OptBlue go a long way toward that goal. Amex clearly understands how valuable its customers are, and are taking a constructive approach to support businesses and make it easier and cheaper for them to accept Amex cards.

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