EBay will no longer accept American Express, but the credit card company said in a statement that the online auctioneer accounts for a minuscule portion of its total business
American Express also took a swipe at eBay, adding that dropping Amex would “limit [eBay] customers’ payment choices and take away the service, security, and rewards that customers value when paying with American Express.”
In a statement, the online auctioneer said American Express charges “unacceptably high fees” on credit card transactions, and said it is preparing customers for a “smooth transition.”
”Based on research, we know that the vast majority of eBay customers are willing to use alternative payment options to continue enjoying buying and selling on our marketplace,” the statement said.
The statement did not elaborate on what it meant by “alternative payment options.” The change will be effective Aug. 17.
An eBay spokesperson said in an emailed statement that it cannot disclose the cost of fees charged by Amex.
“Negotiating fair payment processing fees across our payment partners remains a strategic priority,” the statement said.
The auction site is the world’s second largest e-commerce website, according to the market research site SimilarWeb.
American Express also declined to say how much it charges eBay in fees, but said in its statement that its rates are comparable to those charged by other credit cards.
The interchange and other processing fees charged by credit card companies generally range between 1.5% and 3.5% of the transaction amount, according to the online financial media outlet BankRate.
American Express typically charges higher fees than rival card networks, BankRate says on its website. While Visa and Mastercard charge merchants between 1.5% and 2.5% of the total transaction, American Express charges between 2.5% and 3.5%, the site says, noting that Amex is a ad sponsor.
For years, Amex lagged behind its competitors like Visa and Mastercard in acceptance rates at retailers. In 2014, 3.7 million merchants accepted Amex, but that number had shot up to 10.6 million by the end of 2019, according to The Nilson Report. By comparison, about 10.7 million merchants accepted Visa and Mastercard at that time.
EBay is hardly the first U.S. merchant to refuse to work with American Express. Amex weathered other break-ups with retailers. Mega-retailer Costco ended its partnership with Amex in 2016. The move by eBay, which boasts 132 million users worldwide, is still a setback for Amex.
By Patrick Cooley on June 6, 2024
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