Who Accepts American Express?

Woman making card payment

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The American Express card isn't accepted by every merchant, but it can be used at a growing number of locations in the United States and around the world.

Where Can You Use the American Express Card?

American Express offers many types of credit cards for both consumers and small business owners. Yet sometimes you'll encounter merchants that accept Visa, Mastercard and Discover, but don't take American Express cards. Nevertheless, American Express has been aggressively adding new merchants to its network in recent years, including over 1.6 million new U.S. locations in 2018. For more information, see "Where Can I Use My Credit Card?"

Why Isn't American Express Accepted Everywhere?

If you have an American Express card, then you may have visited merchants who accept other credit cards, but not your Amex. The reason has to do with the interchange fees charged by the credit card payment networks such as Visa, Mastercard, Discover and American Express. These fees are a percentage of each credit card transaction that a merchant has to pay to the payment network. American Express imposes a slightly higher fee than its competitors, and some merchants choose not to accept its cards as a result.

Why American Express Is More Expensive for Merchants

So why does American Express charge merchants more than Visa and Mastercard? American Express is both a payment network and a major credit card issuer. Credit card issuers primarily make money through interest charges and a portion of the interchange fees.

Many American Express cards are actually not credit cards but charge cards. That means that the cardholder is required to pay the entire statement balance in full each month, so Amex typically receives no interest charges from these products. Furthermore, American Express cards almost always provide competitive rewards in the form of cash back or miles and points toward travel rewards. With both the higher costs of offering rewards and less income from customers paying interest, American Express' business model relies on charging merchants higher interchange fees.

Why You Should Always Have a Backup Credit Card

If you primarily use an American Express card, then you should probably carry a backup card from a different payment network for when you encounter a merchant that doesn't accept American Express. But regardless of which card you use, it's always a good idea to have one or more backup credit cards. For example, your primary card could become lost, stolen or compromised in some way, leaving you without a credit card until it's replaced. Having more than one card that you manage responsibly can also add to your positive credit history and improve your credit score.

American Express cards are accepted by millions of merchants, but not at every store that accepts credit cards. While you're likely to find that the vast majority of stores you visit will accept your Amex card, there are several reasons that you should still carry a backup card. By understanding how credit cards work, and why Amex isn't as widely accepted as cards from other payment networks, you can make sure that you always have the right cards to make the purchases you need.