Online trader eBay will no longer be accepting direct payments from American Express credit cards from August. The second-hand marketplace blamed the decision on the ‘unacceptably high fees’ Amex charges for processing credit card transactions.
The change kicks in globally from August 17. The National Retail Federation says the average fee to accept a credit card is around two per cent, but they can go as high as four per cent for premium rewards credit cards like Amex.
eBay said that payment processing costs should be declining due to ‘technological advancements’. But they are continuing to rise ‘unabated’ due to ‘lack of meaningful competition’.
An eBay spokesman said: “eBay customers are being notified about this upcoming change to prepare them for a smooth transition starting August 17 to the variety of popular, relevant, and secure payment options available on our marketplace. 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.”
eBay has around 132 million active buyers.
An Amex spokesman said: “We find eBay’s decision to drop American Express as a payment choice for consumers to be inconsistent with their stated desire to increase competition at the point of sale. Additionally, eBay represents less than 0.2 per cent of our total network volume. American Express card members can continue to use their cards with millions of merchants around the world.”
Martin Lewis’ Money Saving Expert (MSE) website noted that you will still be able to use Amex on eBay if you check out using Paypal. However, the website warned that doing this could mean you ‘lose lose valuable extra protection’.
It said: “BEWARE of doing this with larger purchases, as it could mean you lose out on the valuable legal protection you get under Section 75 of the Consumer Credit Act 1974. Section 75 states that if you pay for something costing over £100 and less than £30,000 on a credit card, the card company is jointly liable with the seller if something goes wrong.” Crucially, for a purchase to be covered by Section 75, there has to be a direct link between you, the credit card issuer, and the place you bought it from and, in some cases, using PayPal can break this link. The exact rules are complex.”
The MSE team said that eBay will continue to accept Mastercard and Visa credit cards after August 17 2024 and using these would get you the Section 75 protection when paying directly.
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