Why do some Indian merchants outright refuse to accept American Express cards? Is it because of the notoriously high transaction fees cutting into their margins, the lower cardholder base compared to Visa and Mastercard, or the slower settlement process that impacts their cash flow?
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Many Indian merchants refuse to accept American Express (Amex) cards primarily due to the high transaction fees, also known as the Merchant Discount Rate (MDR), which are significantly higher than those charged by Visa or Mastercard. While typical MDR for Visa/Mastercard ranges from 1.5% to 2%, Amex often charges between 2.5% to 3.5%, cutting into merchants’ already thin profit margins.