Originally Posted by kapmap

Something many people are not aware of is that the retailer pays the AMEX fee even if you return a purchase -- I don't believe this is true on Visa or MC.

I have a client that sells large ticket items -- had a piano sale of $10,000 on AMEX but the purchase cancelled the sale before delivery and the $10.000 was refunded -- the retailer originally received around $9.700 and was charged the full $10,000 for the refund. When I called AMEX about it and questioned it they told me that was the way they worked -- the fee is charged period. That was a lot to absorb for a small business person.

That said, I am pretty sure a store like Costco or Macy's does not pay the standard 3.1% charge from AMEX -- they are large enough to negotiate that fee down -- but they may still be paying their percent of the transaction fee. So your purchasing and returning a $5,000 item just to get miles costs the club $50-$150 and the other members essentially pay it.

I use my AMEX religiously but try to consider the small retailer if I am purchasing and returning and the cost to them --