Merchants Not Accepting Customers’ Preferred Method of Payment – Bad Decision?

Feb 12, 2014

In recent years, it is more common for consumers in the United States to rely on their debit or credit cards to make payments. Perhaps their reason for not carrying cash is down to safety matters, the fact that cards are generally more convenient, or maybe they simply do not have the cash and need to make a payment on their credit card to pay back later. Whatever the reason may be, the use of cards is now the norm, and the numbers are still growing. Therefore, it should be a matter of principle and common sense that merchants should be willing to accept payments via credit or debit card. However, it has come to the public’s attention that many merchants do not accept American Express and Discover cards.

“Why is this?” you ask. Perhaps merchants are unwilling to accept American Express and Discover because they aren’t able to pay the high credit card processing fees; the current financial recession probably does not help the situation at all. Many people are arguing fact that saving a few dollars by not accepting these cards is not worth it when considering the aggravation the customer may experience when his or her preferred method of payment is refused. The customer is always right, after all.

Merchants who are not willing to accept these payment methods are more than likely doing the wrong thing. American Express and Discover are among the top credit card brands in the United States of America. Their generous rewards to consumers just for signing up contribute highly to their success, and thoughtful gestures to lure the consumer in include things like cash back, hotel discounts, gift cards, and exclusive VIP bonuses like access to airport lounges. It is surprising that so many consumers are willing to pay the steep annual charges just to gain access to these tempting treats, but in fact, plenty is more than happy to pay. Statistics show that 89% of consumers are enrolled in an American Express Loyalty program, and 78% of Discover customers with a rewards card choose to use it as their primary card.

More generally, 51% of Discover cardholders said they have not/would not return to a merchant if their card was refused, and 72% of American Express consumers would be more likely to return to a merchant if their card was readily accepted. Credit cards allow consumers to eliminate the need to carry cash and make convenient and spur-of-the-moment transactions, whilst ensuring that added safety at the same time. Basically, a merchant who chooses not to accept consumer payments by American Express or Discover is eliminating their sales figures and customer loyalty. Sure, saving money is a good enough excuse, but is rapid customer base loss really worth it?


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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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