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The Discover credit card isn't as widely accepted as Visa and Mastercard, here in the U.S. or in other countries worldwide—but it has closed its historic acceptance gap considerably. And its cash back rewards and lack of annual fees make it an attractive choice as a first credit card, or as a supplement to the more widely accepted cards.
Where Can You Use the Discover Credit Card?
In comparison with the other three top credit card brands (Visa, Mastercard and American Express), Discover lags behind Mastercard and Visa in terms of user numbers and acceptance in the U.S. and worldwide. But it beats American Express on both measures, and you can use it at the vast majority of U.S. businesses that accept credit cards. It's also available in many overseas markets, in part thanks to affiliate partnerships with the Diners Club and JCB networks, which have greater global reach.
As to practical, everyday usefulness, Discover cites credit card industry analyst The Nilson Report to claim its cards are "accepted nationwide by at least 97% of the merchants that take credit cards." That's very high market penetration and, indeed, major national retailers such as Walmart and Target accept Discover in-store and online, as do Amazon.com, electronic payment services PayPal and Venmo, and ride share services such as Uber and Lyft.
The fees Discover charges businesses that accept its cards are likely responsible for the resistance among merchants who refuse it but accept other cards. All card networks charge members fees on each card transaction, but Discover sets its fees somewhat higher than its competitors, in part to help pay for its cash back program.
Where the Discover Card Isn't Accepted
The exact numbers of businesses, domestically and worldwide, that accept any specific credit cards are ever-moving targets. But even just 3 percent of card-accepting companies that don't take Discover in the U.S. could constitute tens of thousands businesses, if not more.
Many of these are likely small, independent merchants who find Discover's transaction fees too steep to handle, but they may also include franchised outlets of national brands such as fast-food restaurants, convenience stores, hardware stores and car repair services, for which individual owner-operators are free to choose which card networks to join (and avoid).
One major national chain outlet that doesn't accept Discover at any outlets is Costco, which only honors one credit card brand at its members-only warehouse stores, tire centers and gas stations. In 2016, Costco ended a 16-year partnership with American Express, and it currently accepts only Visa cards.
Note that with any credit card, you could be charged a convenience fee by merchants who prefer not to accept credit cards—but your Discover card will be treated the same as other cards in this situation.
Backup for the Card That Pays You Back
While there are long odds against finding a U.S. business that accepts other credit cards but not Discover, those businesses do exist. If you find yourself at one with only a Discover card (and a shortage of cash) in your wallet, you may be forced to take your business elsewhere. That may not be a big deal if you're seeking dinner in a busy town, but it could be a hassle in a remote area, or under emergency circumstances when shopping around is impractical—or impossible.
If you're attracted to Discover's lack of annual fees and cash back premiums (or the miles rewards on its travel card), you'll no doubt find it broadly useful. But adding a more universally accepted Mastercard or Visa to your wallet, at least as backup, might be good idea when you're considering broadening your credit card portfolio.