10 Jun 2024

eBay to ban American Express payments – which other retailers don't accept Amex?

eBay will stop Amex payments from 17 August due to 'high fees'

The online marketplace eBay will stop accepting payments from American Express (Amex) cards from 17 August due to ‘unacceptably high fees’.

Amex offers a range of reward credit cards, where you earn cashback and points on your spending. However, if you shop on eBay regularly you’ll need to switch payment methods or use an alternative, such as PayPal.

Here, we explain what this means for Amex customers, reveal a workaround and list the surprising places that don’t accept Amex.

Why is eBay stopping Amex payments?

eBay will no longer accept Amex cards globally due to the ‘unacceptably high fees American Express charges for processing credit card transactions’.

In a statement it said: ‘At a time when payment processing costs should be declining because of technological advancements, investments in fraud capabilities and customer protections, credit card transaction fees continue to rise unabated because of a lack of meaningful competition.’

It added it felt there was a need for more robust regulations to drive greater competition to credit card networks to reduce transaction processing costs.

In response, Amex told Which? it was disappointed with the decision, arguing it would limit customers’ payment choices, taking away the service, security and rewards offered by Amex.

Amex said: ‘Our research tells us that in the US the cost of acceptance for American Express is comparable to what eBay pays for similar cards on other networks.’

Amex added that eBay represents less than 0.2% of its total network volume.

Find out more: best and worst places to shop second-hand online

What are credit card processing costs?

Every time a business accepts a card payment from a customer, it must pay a credit card processing fee.

Businesses are not allowed to impose surcharges on the customer for paying by a debit or credit card, so these costs are usually factored into the price of the item.

Some retailers refuse to take Amex cards as payment because of the higher fees they have to pay to process the transactions compared to MasterCard and Visa, which account for 95% percent of all debit and credit payments in the UK.

Amex justifies these costs with premium services for merchants and access to a premium type of customer.

It says its UK cardmembers spend 43% more money on average than people using other credit cards.

Find out more: best credit card providers 2024

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How you can still use your Amex card on eBay

From August 17, you will no longer be able to use your American Express card directly on eBay, but you can still use it through a third-party payment processor, such as PayPal. However, if you use PayPal you may lose an important legal protection.

Section 75 makes your card provider and the retailer or service provider ‘jointly and severally’ liable for any breach of contract or misrepresentation, providing the item or service cost between £100 and £30,000.

This means that if there's an issue with something you’ve bought, and the retailer or service provider can’t or won’t make things right, you can claim a refund from your credit card company.

If you use PayPal, or any third-party payment processor, you might not be covered by Section 75, as you’ll be breaking the direct link between you, your credit card provider and the place you bought the item from.

However, if you use your credit card to pay for something through PayPal – and the funds go directly to the seller – as long as the company you’re buying from has a Commercial Entity Agreement with PayPal, you may still be able to claim against your credit card company under Section 75.

PayPal has its own buyer protection scheme, under which you will be reimbursed if you don’t receive an item, or it doesn’t match the seller’s description.

Find out more: Section 75 protection – 5 things you need to watch out for

Which retailers don't accept American Express cards?

The good news is most large retailers do accept American Express, including all major UK supermarkets.

For travel, most airlines and big train firms such as Avanti, ScotRail, TFL and Trainline accept American Express, but we found several bus firms that don't, including Arriva, National Express and Stagecoach.

Quite a few big restaurant and fast food chains accept American Express, including Bill’s, Costa Coffee, Dominos, Five Guys, McDonald’s, Pizza Express and Starbucks. Greggs and KFC do not.

Most big retailers accept Amex, including Amazon, Argos, B&Q and the Post Office. However, it’s not accepted by Sky, or Virgin Media.

If you’re unsure when paying, it might be worth asking the cashier beforehand. You can find a list of the retailers that accept Amex on its website.

Find out more: best credit card deals in June

Is Amex a good provider?

Amex is a Which? Recommended Provider, and achieved a customer score of 79% in our survey, putting in second in our table behind Tesco Bank.

It scored five stars for its mobile app and clarity of statement, and four stars for its transparency of charges, application process and customer service.

It also has three cards which were awarded the Best Buy endorsement – the American Express Rewards Credit Card for airmiles, the American Express Platinum Cashback Credit Card, and the American Express Platinum Everyday Credit card for cashback.