Should I offer American Express as a payment method?
As a merchant you’ve almost certainly asked yourself this question before – Is offering your customers American Express as a payment method really required? How much difference does it actually make? What are the pros and cons of doing this? We’ll get straight to business and discuss this from a merchant’s point of view. After all we (Merchant Warrior) are a merchant as well and we’ll explain why we chose to offer American Express (AMEX) to our customers as a payment option.
American Express fees are too high, it’s not worth it to me.
The above heading is often the answer that most merchants give when asked about why they are not offering AMEX as a payment option. It’s a very valid response. Generally speaking when merchants think of Merchant Service Fees relating to VISA & MasterCard they think of varying percentages around 0.5-2%. Ask a merchant about the rates that come to mind when dealing with AMEX and they will often quote figures from 2-3% as a minimum. With this said it’s no wonder why merchants are turned off by AMEX and choose not to offer it, BUT the real question is: is it worth it?
American Express charge an establishment fee and the only ongoing cost is the merchant service fee as discussed above, so what is there to lose? If your AMEX facility does not process any transactions you will not be charged anything extra. For those of you who have an AMEX, how often have you walked into a store and been disappointed to find out that the store does not accept AMEX? And if you are asked to pay a surcharge due to having an AMEX, have you ever declined?
Customers are kept happy when they are offered multiple payment methods. As a merchant, not offering a specific payment method could lead to a reduction in sales and no merchant would want that to happen.
It’s for this reason that it is our recommendation that all merchants look to establish an American Express facility when looking to operate an online store.
Show me the MONEY!!
It’s understandable that some merchants will not want to move forward with establishing an AMEX facility unless they see the proof that it is actually required. After all, there is no point in having an AMEX facility if you have statistics that are proving that 0% of your customers use an AMEX to purchase your products.
We understand that and that’s why we provide our merchants with reporting that helps them make the important decision as to whether they require a specific payment method or not.
The above image (please click the image to view it) is an example of a merchant who is yet to have an AMEX facility established for their online store. This report informs the merchant that $25,000+ worth of sales have been declined due to the fact that AMEX was not offered to customers as a payment option. By viewing this report the merchant is able to take notice of the large number of sales that are being declined due to customers not being able to purchase products with their AMEX cards. This report proves to the merchant that an AMEX facility is a definite requirement for his/her store.
How do I accept American Express payments?
In order to establish an American Express merchant facility you will have to apply with American Express Online Merchant Services directly. You can begin the application process by visiting https://www.americanexpress.com/australia/merchant/home/merchant_p.shtml and clicking on the “APPLY NOW TO ACCEPT THE CARD” link at the top of the website. Alternatively, you can simply call the following number 1300 363 614 – option 4. Please note that these instructions are for Australian merchants only.
Multiple payment methods enable merchants to increase sales and provide customers with a pleasant purchasing experience. Put quite simply – when starting your online store and establishing a merchant facility with your Bank to accept VISA & MasterCard transactions, American Express should not be forgotten.