What are the Reasons the American Express Card is Not Accepted Everywhere?
The American Express card is not accepted everywhere for a couple of reasons. One reason the American Express card may not be accepted everywhere is because many businesses and merchants do not want to pay the fees that the credit card company charges them to accept Amex cards. The other reason why some businesses and merchants will NOT accept Amex cards is because they do not want to deal with the hassle of dealing with Amex credit card customers.
Amex Credit Card Fees
The fees that American Express charges businesses and merchants are what leads some companies not accepting Amex cards at their business. One of the main reasons why companies do NOT want to accept American Express cards is because there is a fee known as the Merchant Discount Rate (MDR).
The MDR is the percentage of the transaction that American Express charges businesses to accept their credit cards. For retail companies, these fees can be upwards of three percent and for travel and entertainment company’s MDRs can be as high as five percent.
The reason why companies do not want to pay such high percentage rates to accept Amex cards is because it will cut into their earnings. If a business’s MDRs are three percent, then that company would only be getting 97% of the transaction if they accepted Amex cards. By not accepting American Express cards, companies can maximize their profits by tacking on additional fees or raising the prices on their products.
Amex Customers and Credit Card Fees
Another reason why American Express cards are not widely accepted is because of the company’s policies. To use Amex cards, consumers must pay a membership fee to be able to shop at stores that accept them. This membership fee charges all cardholders who have an Amex credit card for their yearly fees.
Some consumers may not be willing to pay this fee just to have a credit card that they can use at certain establishments. This membership fee is something that American Express charges all of their customers regardless if the customer only uses one Amex card for their day-to-day purchases or has several cards under their name.
Amex also charges separate fees for their customers to use Amex cards. If a consumer wants to make a large purchase using their American Express card, they will be charged a fee by the company for this transaction. These fees can range from 3% of the total purchase up to 5%. It is these extra fees that may keep some consumers from wanting to have an American Express card.
American Express customers do not like these fees and policies either, which is one of the reasons why they do not like doing business with American Express as well. Amex cardholders may be willing to pay an annual fee but this fee does not always guarantee that a customer can shop at several establishments.
Sometimes Amex cards are declined even if there is money in an account or a cardholder has exceeded their credit limit. Some Amex customers have also complained that they are required to use a pin when using an Amex card at certain stores even though other credit cards do not require the use of a pin for them to be accepted.
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