Here’s what American Express is doing to get more businesses to accept your card
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Picture this: You’re at the neighborhood corner store stocking up on junk food and ice cream as you prepare to settle in for the night with Netflix. You approach the cashier, they ring up your stuff, and you whip out your shiny American Express card. Before you can even hand over your card they say, “Sorry, we don’t accept American Express.” Disheartened, you either fork over another card or put your items back.
If you hold an American Express card, this is probably a scenario you’ve faced. But if Amex has its way, you may experience less of it.
According to a report from the Wall Street Journal, the company is offering bonuses to some businesses that don’t take Amex cards as it competes with Visa and Mastercard. The payments have ranged from under $10,000 to about $450,000, the Journal reported. The Journal says that more than 100 small businesses have received the sign-on bonuses since 2018. Amex representatives have even visited some businesses in person in an effort to convince them to accept its cards and the company has tied its sales force’s bonuses to the effort.
Since 2017, more than three million businesses started accepting Amex cards. Of those, Amex says that 133 merchants deemed “strategic priorities” received a sign-on incentive, a tiny fraction of 1% of the new merchants the company brought on. The company says the businesses had to sign an agreement that required them to enable Amex acceptance in all their locations (if they have more than one.) The company says the incentives intended to help defray costs like train staff on new technology and to reprint signs.
The company has long struggled to level the playing field with its competitors Mastercard and Visa. Famously, American Express isn’t accepted at many smaller or family-owned merchants, with the Journal reporting that Visa and Mastercard are accepted at over a million more U.S. locations than Amex.
As TPG’s Ethan Steinberg wrote earlier this year, the cost for merchants to accept Visa and Mastercards has risen, while the cost to accept Amex has decreased over the last 10 years. Amex has also invested in fraud prevention capabilities and other business tools such as Shop Small/Small Business Saturday and Amex Offers. Amex also launched OptBlue, which was created to remove the hurdles associated with accepting Amex cards.
American Express also says that some merchants don’t accept Amex in the U.S. because of the perception of higher fees. Most merchants can accept American Express and on average, there’s little cost difference between Amex, Visa and Mastercard.
According to a Nilson report, Amex customers spend on average 3.1x a year more than non-Amex customers. The same report also showed that Amex customers spend an average of $14,000 a year on their cards.
Featured image courtesy of Wyatt Smith/The Points Guy
Aside from the 75,000 points welcome bonus, Amex recently made huge improvements to the Business Platinum Card, including the fact that you will now earn 50% more points on purchases of $5,000 or more, earn 5x on flights and eligible hotels at Amextravel.com and cardholders will receive an up to $200 airline fee credit each year.
- Earn 75,000 Membership Rewards® points after you spend $15,000 on qualifying purchases within your first 3 months of Card Membership.
- Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com.
- Get 50% more Membership Rewards® points. That's an extra half point per dollar, on each eligible purchase of $5,000 or more. You can get up to 1 million additional points per year.
- Enroll to get up to $200 in statement credits annually by getting up to $100 semi-annually for U.S. purchases with Dell. Terms apply.
- 35% Airline Bonus: Use Membership Rewards® Pay with Points for all or part of a flight with your selected qualifying airline, and you can get 35% of the points back, up to 500,000 bonus points per calendar year when you book on amextravel.com.
- Terms Apply
- See Rates & Fees