In the latest development in the battle over credit card network processing fees, eBay announced on Wednesday that the online marketplace will stop accepting American Express credit cards starting Aug. 17, 2024.
"After careful consideration, eBay has decided to no longer accept American Express globally effective August 17 due to the unacceptably high fees American Express charges for processing credit card transactions," eBay wrote in a statement. It said customers are being notified of this change.
What's the fight over processing fees?
Credit card networks charge merchants a fee for using their credit cards. These fees -- called swipe, processing or interchange fees -- typically range from 1.5% to 3.5% of each transaction. American Express typically charges the highest processing fees of the credit card networks (that also include Visa, Mastercard and Discover), which has impacted Amex adoption rates.
Amex and eBay had been negotiating the cost of the network's processing fees, according to Bloomberg. However, the two entities were seemingly unable to agree on an appropriate price.
Swipe fees have been a major point of contention between credit card networks and merchants. In March, merchants reached a settlement with Visa and Mastercard to reduce these fees in an effort to limit the cut the networks take.
Nearly a year ago, the Senate reintroduced the Credit Card Competition Act, which also targets network processing fees. It was originally introduced in 2022 but failed to pass Congress.
The CCC Act aims to limit merchant fees by increasing competition between credit card networks. It specifically targets swipe fees above 2%. However, there hasn't been much movement on the act since its reintroduction.
What it means for Amex cardholders
Unfortunately, come Aug. 17, 2024, Amex cardholders will need to use an alternative payment method when shopping on eBay.
"We are disappointed that eBay made the decision to stop accepting American Express Cards as of August 17, 2024. By doing so, they will limit customers’ payment choices and take away the service, security and rewards that customers value when paying with American Express," American Express wrote in a statement.
Once the change takes effect, Amex cardholders will need to use an alternative payment method with eBay. Visa and Mastercard are accepted, and PayPal is supported by the online marketplace.
It's typically a good idea to have an alternative payment option on hand. Whether it's a credit card from a different network, a debit card or cash, having multiple forms of payment helps ensure a successful transaction.
Additionally, some merchants pass along credit card swipe fees to their customers, so having an alternative payment option could save you money.
