Credit Cards

AMEX Merchant rates - premium card markup?

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  • Feb 14th, 2018 8:31 pm
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[OP]
Penalty Box
Aug 10, 2010
781 posts
198 upvotes
Mars.

AMEX Merchant rates - premium card markup?

As many people know, MC and VISA has a tiered rate for merchants. Premium cards typically incur a higher rate for merchants when they accept our credit cards.

Does AMEX do this? E.g. Does AMEX charge the merchant more when a customer uses a Plat charge card vs an Air miles AX credit card?

Anyone know? Thanks
Don't be a cooch.
5 replies
Deal Addict
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Jan 4, 2011
3845 posts
4883 upvotes
Montreal
I can't say for certain, but everything I've read says no. Amex doesn't charge an "interchange fee" (which is what varies by card type) since it is its own issuer. Rather, it charges a "discount rate", which is largely dependent on the category code, i.e., grocery will get charged one rate, airlines will get charged another, etc.

https://www.merchantmaverick.com/comple ... ing-rates/

https://lop.parl.ca/Content/LOP/Researc ... 0910-e.htm

https://www.cardfellow.com/american-exp ... ount-rate/
Member
Dec 27, 2017
211 posts
107 upvotes
Ontario
efrant wrote: I can't say for certain, but everything I've read says no. Amex doesn't charge an "interchange fee" (which is what varies by card type) since it is its own issuer. Rather, it charges a "discount rate", which is largely dependent on the category code, i.e., grocery will get charged one rate, airlines will get charged another, etc.

https://www.merchantmaverick.com/comple ... ing-rates/

https://lop.parl.ca/Content/LOP/Researc ... 0910-e.htm

https://www.cardfellow.com/american-exp ... ount-rate/
This matches my understanding too - that Amex charges the same for all varieties of their cards, but they differ depending on the merchant code of the purchase. For many small businesses that use simplified processors like Square or Stripe, they get charged the same fee for all cards regardless of the underlying fees. For those that use the bigger players they get negotiated contracts and those sometimes have bigger fees for Amex than others. I haven't heard of any that differentiate between the Amex varieties though.
Sr. Member
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Dec 20, 2017
683 posts
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It seems if you're doing lower volume (Sub 500k in Amex transactions) and enroll in the opt-blue program, the rates are dependent on your total transaction amount. The more expensive the ticket, the higher the %.

https://www.helcim.com/ca/american-express/

At those figures, even including the processor markup fee, puts it comparable to Visa Infinite Privilege/ MC WE cards. Wish more restaurants new about this program as the fee only becomes higher than Visa/MC premium cards past $200.
Deal Addict
Feb 17, 2017
1244 posts
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Calgary
My partner used to have this issue explaining to merchants why Amex wasn’t anymore expensive than other cards in the UK (he used to work for Amex merchant services).

It was pretty ridiculous how Visa and MasterCard transactions could add up (admittedly many of them were acquier fees but they all charged them). You’d be charged an extra 1% for taking any rewards card, then another 0.5% if it was a world elite card or other premium card, another 1% if it was a non-eu card, another 1% if the card didn’t have a chip (how is that the merchants fault?). That 1.5% rate suddenly became 3 or 4% especially in tourist locations. The other thing was almost all AmEx cardholders used another rewards card when they couldn’t use their Amex, so merchant were going to pay more either way. Bizarrely Amex had extremely competitive card not present rates in the UK, often below Visa and MasterCard. It’s no wonder the EU ended capping all the fees to 0.3%.

Acquirers do try to con their merchants (along with the card networks), for example in the UK and Canada, many of them will give you domestic rates on Discover credit cards, despite the fact no domestic Discover cards exist.
Deal Addict
Nov 8, 2017
1530 posts
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I think the market dictates what reaction there is to Amex.
It costs merchants more to use Amex, hence that's why there's not as many merchants willing to accept it.

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