Originally Posted by
kyanar
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Everything you just said is hogswash. For a start, it's the merchant being charged that 3% or whatever, not you...
No duh.
...so in theory you should actually get less from Amex than the merchant does, including unfavourable dispute terms, worse customer service, and crappier benefits.
That's not the history of the AMEX business model, sorry. That is why AMEX used to have a very loyal following of high spenders. If you're saying the reduced merchant fees will have those results, I've pointed that out many times already.
Second, if they reduce their merchant fee by 30% (it's not interchange, there's no network switching happening) but increase their merchant acceptance by 40%, they're actually net benefiting.
Again, missing the point. Since AMEX is already accepted at 65ish percentage of merchants, adding 30% more merchant acceptance won't matter that much if you're reducing your revenue significantly from the other 65%.
Third, they're not exactly competing with Visa/MC.... The merchant fee on an Amex Green card is still 2.37%. The interchange on a MasterCard World Elite is not a whole lot more than that, but the MasterCard standard is a heck of a lot less. Amex is still making out like a bandit on the average transaction.
Actually they are. Chase has been eating AMEX's lunch, and other banks have started to turn up the stove heat to a pretty high level on AMEX's behind. The whole point of needing additional acceptance is to compete with Visa and MasterCard. If a merchant doesn't take AMEX, there's no competition at that store/merchant. There's no "merchant fee" for the Green Card. The store's vendor negotiates a lower price if the merchant does enough transaction volume. And nobody applies for an AMEX and expects a high acceptance rate at merchants... Only a fool does that.
But again, you came here to destroy a civil discussion, so if you expect me to carry on a conversation with you, you might not want to use the words "hogwash" and "first of all," next time.