A new American Express program is available which reduces payment processing rates for ecommerce merchants. It allows providers to set the rates and fees their merchants pay for American Express similar to the way they set rates and fees for Visa, MasterCard and Discover.
This option is welcome news for small merchants in particular. The caveat is that the rates and fees must be set up properly in order for a savings to be realized. It is vital that the merchant work with their payment processor to navigate the maze of network and tier associated fees. Once this is done however, it can actually cost the merchant less when customers pay with American Express than Reward and Corporate/Business cards offer by Visa and MasterCard.
Not all merchant types will pay less for payments made with AmEx but it is certainly worth discussing with their payment processor. The goal of American Express has been to implement a pricing structure that is less complicated than those of Visa, MasterCard, and Discover.
Payment processors have tools available to compare rates between the various cards and help the merchants optimize the rates and fees that are best suited for their specific situation. As always, it is a good idea to monitor the fees charged on a regular basis. Merchants should ask for reports from payment processors that clearly spell out costs associated with all payment processing including American Express. If the report is not clear, they should ask for clarification – again in writing – or look for another payment processor to service their merchant account.