Dear Valued Merchant,
Have you ever wondered why some stores don’t accept American Express cards? The main reason is that American Express cards comes with higher fees for the merchant. The typical fee for Visa/Mastercard is between 1.1% and 2.95%, while American Express is between 2.3% and 3.5%. This is due to the fact that most American Express cards are actually “charge cards”, rather than credit cards. A charge card means cardholders are required to pay their balance each month, rather than roll over balances with interest like a typical credit card. Due to not making interest on most of their cards, American Express passes on higher fees to merchants in order to make profits.
Although the higher fees may deter a merchant from accepting American Express cards, there are some potential benefits to doing so. According to the American Express official website, their card members spend 3.7 times more money on American Express cards compared to credit cards from other brands. This is largely due to American Express cards typically offering excellent rewards. The average transaction size of an American Express card member is also 1.8 times higher than credit cards from other brands. Just something to think about! 😊 As always, thank you for your business. Make it a great day!