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Small Businesses To Save On Amex Fees

American Express is planning to reduce transaction fees for some small businesses by 1 percentage point as it pushes to double its presence in Australia.

The credit card company’s vice president of small merchant Katrina Konstas told The Sydney Morning Herald that the company wants twice as many small businesses accepting Amex in two years time.

“We want to make it a lot easier for merchants to accept American Express… For some businesses, it will be a reduction of a whole percentage point,” Konstas said.

Reserve Bank figures put the average fees for Amex at 1.58% of the transaction value compared to 0.78% for Mastercard and Visa. Small businesses typically face even higher fees than this average for Amex, and many choose to not accept it or to pass on the additional costs via a surcharge.

Small merchants, which American Express defines as businesses with less than $10 million in annual turnover, can mostly expect to pay fees of less than 2% by the end of the year. Some will also be charged the same amount for Amex transactions as Mastercard and Visa transactions below a certain turnover threshold in a new deal with the Commonwealth Bank.

Recently, the big four banks all altered their Amex offerings in response to regulation changes that reduced the income they receive on transactions. ANZ discontinued Amex cards completely, while Commonwealth, Westpac and NAB reduced the amount of points earned.

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