Shonky Merchant Fees

I haven’t read all the awards in detail yet but the idea of these awards is great and certainly, Kelloggs deserve one for the change in Pringles, if it’s all as described.
However, although AMEX is big and ugly enough to defend itself, I believe you’re quite WRONG regarding their ‘surcharge free’ campaign. ALL the card issuers charge a merchant fee and while you’re correct in saying that AMEX’s fees are more than standard Visa and Mastercard, they’re not much different from our banks’ ‘premium’ cards, business credit cards or international cards. These all cost the merchant 1.5 - 2% or more, of the transaction. Amex is 2 - 3%, sometimes less. I operate a small retail business and we take all the major cards. We now see a large proportion of Premium and Business Visa/Mastercards compared to standard types as the issuers offer their customers inducements to get the ‘superior’ card and then charge us more to pay for it. Why single out AMEX? All the banks do it - charge merchant fees to pay for card benefits to THEIR customers.
We don’t apply a surcharge to AMEX or Platinum Visa or any other card, nor have a minimum transaction for EFT. Merchants don’t HAVE to take AMEX [risking annoyance from their customers] and if they do, IMO they shouldn’t charge for it as it also can annoy the customer. There’s a cost to taking cash too. I rather have 100% EFT. Nothing to count, no mistakes, no security issues, no float/cash on site, no trip to the bank, no bank deposit fees!!
Like any other business expense it needs to factored into the pricing. We don’t apply a surcharge if customers want the lights on! or the Cooling! Some customers might be happy to get a bit warm in the shop on a hot day if it saved them money!!
As a customer, it riles me that an organisation like e.g. Accor Hotels charges 1.5% to use a credit card. If our little shop can absorb the merchant fee I’m sure Accor Hotels could. And those organisations like the telcos, airlines and ticket booking services who charge a separate card fee when there’s usually no option should be heavily criticised constantly - but people just let them get away with it.


I am afraid I can’t let Amex off so lightly. We had a Commonwealth MasterCard for many years and it is accpeted virtually evrywhere. Then the Commonwealth Bank decided to give us an American Express Card as well as our MasterCard. David Jones also tried to get us to make our store card an American Express Card. We refused.
We tried, oh boy did we try, for almost a year to use the Amex card instead of our MasterCard. It was a disaster! Shop after shop either does not accept it at all, or they add a hefty surcharge to it. This of course also applies to restaurants etc. When I talked to merchants they all said the same thing - Amex charge much higher merchant fees and, as my father found when he owned a business, Amex do not give NOT reliable service. He had all sorts of trouble with Amex cards for his employees and dumped then in favour of MasterCard.

I was once on a market research panel which was supposed to advise David Jones about its credit card. Unfortunately a very wealthy businessman dominated the whole proceedings, because the weak hostess let him, and boasted about his “wonderful” black Amex Card, which he insisted on showing to all of us, and he told us how many he rewards he got from it. Since he spent the annual income of a small country with it each year (yes he told us about that as well) I am not surprised he got good rewards.

In short, Amex might offer the high and mighty extra rewards, but for the merchants and for us ordinary folk they are greedy and unreliable.

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Excellent work, dicksp8. I wish all merchants had your attitude towards cards. It really gets up my nose having to pay surcharges,


I wish every business person in Australia thought the way that you do dicksp8!

It would be great if no business were legally able to restrict access to credit card use by a customer, no restrictions as to what type of credit card that they may use, no minimum purchase rule and very importantly, no surcharges!

All businesses should be able to incorporate the cost of any merchant fees into the final price for any good or service, thereby not allowing any price above the cash price when using any credit card.

That is exactly how it should be! Thank you for your intelligence dicksp8!

I just wanted to reiterate that in my experience, Amex merchant fees are little different from Premium Cards, Business cards and International cards. We now get a large proportion of such cards in our tendering, because, like bank issued Amex cards, the issuing banks etc. promote them to get higher fees all round. Card users pay more, merchants pay more, and the benefits to consumers are rarely worth the extra fees.
With respect to their acceptance by merchants, whilst many small businesses do not take them I find that many do, and certainly all the major supermarkets and many retailers do as well.
Returning to my original point, I don’t think American express deserve a shonky award for asking merchants to charge no surcharge. They are in fact working to the benefit of card users. They are not much different from the other card isuers.

I am an AMEX customer, have been since I was 19. Their service is head and shoulders above dealing with a bank for a credit card particularly in fraud protection, card replacement, and speed to actually get to speak to someone and the speed to resolution.

What I found annoying is how shops deal with it. I use AMEX as my preferred card and I get all sorts of comments, some of them quite rudely delivered, but what I am hearing more and more regularly is “we have a surcharge on use of credit cards - are you ok with that?” Ummm, let me think about that, my answer is “no”. I’d rather shop were there wasn’t a surcharge, thank you. If you travel you notice that the USA, european countries don’t charge any credit card use fees - Amex, mastercard or visa. In the USA you can use your Amex to buy chewing gum if you want. So why is Australia charging the merchant fees?

Who get’s paid in cash anymore? Do we even have the option? Yet we have to pay surcharges for the convenience accessing our electronic money. The vendor gets secured transactions and direct deposits whereas previously they had to count the cash and carry it to bank daily, are the overheads really any more for electronic transactions? How log before we get a cash surcharge?

Here’s my idea, put your prices up by 2% on the label and don’t charge me a fee to use my credit card, I won’t even notice.

The Okami Japanese restaurant opened recently in Greensborough VIC. They apparently have multiple locations so not a mum and pop operation.

They have a 2% credit card surcharge.

The whole surcharge concept irritates me like US posted prices that are prohibited from including their sales taxes; US businesses include card fees in pricing as a cost of business after consumer backlash from an abortive attempt to add them years ago. Have a $50 item and in the US you will be charged (sales tax is location dependent) about $54 in most places, and at the Okami buy a $50 meal and get charged $51 GST inclusive w/card fee.

In the modern world it is appalling that government considers virtually anything that is made transparent to be just fine. Next businesses might add charges for printing the bill instead of just displaying it on their device, followed by a surcharge for the systems required to take and process an order.