Shop Talk: Practical answers for tough business questions.

by : 
Kim Perkins
June 1, 2013

Question: I currently accept mastercard, visa, discover, and American Express cards. Many of my customers who make higher dollar purchases use American Express almost exclusively. However, it’s becoming increasingly expensive to accept American Express, and I’m considering not accepting it any longer. With the economy the way it is, I need all the monies in my pocket rather than going toward fees. I stated in my recent annual sale email that we preferred MC/Visa, but I’m wondering if I should announce we no longer accept Amex at all. What do you suggest?

Answer: The laws surrounding acceptance of credit cards have changed recently and also can vary depending on the issuing card company. Before you make any definite change or statement of intent to accept or deny a certain card, check with your merchant credit card processor and make sure you are within your legal and contractual rights to do so. For instance, my merchant contract with American Express states that if I choose to accept American Express as well as other credit cards, I will not show preference for one credit card over another. So, I can decide not to accept American Express cards, but I am not allowed to tell customers we prefer Mastercard or Visa to American Express. My sources tell me the laws and regulations may be changing yet again, so your best resource is your merchant processing company.

That said, I too have had some of your same feelings about accepting American Express cards. Our processing fees for American Express are between one-half to three-fourths of a percent higher than any other card, and that can add up! I used to wrestle with these numbers and get upset each time I watched money float out the window because we had a large American Express charge. Then I did some more research and discovered the same statistics you mentioned: customers who use American Express tend toward much higher average sales than those who use other credit cards. Knowing that, I made peace with the processing fees as a worthwhile and necessary cost of doing business if I want to attract higher net-worth customers. It no longer bothers me to pay the higher fees … most of the time. There is still a slight wince occasionally! Today, I focus on being grateful that customers who favor American Express cards shop at our store.

I think it would be a mistake to stop accepting American Express cards altogether, even if they cost you more to process. If it continues to be a concern, you could switch your credit card processing to one of the newer, portable processing alternatives, such as The Square, which charges a straight credit card fee of 2.75 percent. I use this in another business where merchandise is offered mainly at retail shows, simply because it is quick, mobile, and easy. In the long run, I have found The Square is not really more cost effective because, while American Express rates may be lower, the Mastercard and Visa processing fees are substantially higher.

Kim Perkins is co-owner of Elysian Fields Books & Gifts for Conscious Living (, an award-winning store in Sarasota, Fla. Send your retail questions to