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eBay drops American Express as payment option over fee dispute

Published 2024-06-05, 12:14 p/m
© Reuters.  eBay drops American Express as payment option over fee dispute

Proactive Investors - eBay Inc (NASDAQ:EBAY, ETR:EBA) has announced plans to discontinue accepting American Express Company (NYSE:NYSE:AXP, ETR:AEC1) cards as a payment option due to what it perceives as "unacceptably high fees."

The decision, set to take effect on August 17, comes after negotiations between the two firms regarding merchant discount rates, with eBay citing the considerable costs imposed by Amex for processing credit card transactions.

While Amex argues that its fees are comparable to those of other networks like Visa (NYSE:V) and Mastercard (NYSE:MA), eBay asserts that Amex's charges are disproportionate, especially considering the transaction size.

In a statement, American Express said that “card members have an average transaction size at eBay that is more than double the transaction size of cards from other networks.”

“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,” it added.

This move by eBay follows similar actions by competitors like Amazon.com Inc (NASDAQ:AMZN)., highlighting ongoing disputes over transaction fees in the e-commerce industry.

The decision reflects eBay's strategy to explore alternative payment methods, including buy now, pay later options, as it seeks to maintain competitiveness amidst market shifts.

Shares of eBay slipped 1.2% by midday in New York, while American Express shares were down close to 1%.

Read more on Proactive Investors CA


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