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Where can American Express cards be used?

With more than 133 million cards in circulation, American Express boasts the fourth largest credit card payment network in the world. And according to an article from Forbes, American Express credit cards are accepted by more than 66 million vendors and merchants across the globe.

And yet, it is a well publicized fact that not all merchants accept American Express. While the vast majority of merchants will run your Visa Card or Mastercard without hesitating, some merchants may choose not to accept American Express. You may even find that your American Express card is declined when you go to use it at a self-pay terminal.

So what’s the deal? If American Express credit cards are so prestigious, why aren’t they accepted everywhere? 

Well, it has a lot to do with the American Express business model, which is unique among credit card issuers. For one thing, American Express has historically used high merchant fees rather than interest charges on customers to create revenue. For another thing, AmEx does cater to a high end clientele. Check out our article about the exclusivity of the AmEx brand to learn more about this target market.

Or read on and find out why your American Express may not be accepted everywhere you go.

Why isn’t American Express accepted in some places?

The short answer is that American Express charges higher merchant fees than its top competitors. The longer answer is that American Express generally does this so that it can pass benefits and rewards along to its customers.

For the first several decades of its history, American Express only offered charge cards. Cards like the Classic Green Card and the Platinum Card offer holders spending flexibility. In exchange for this flexibility, cardholders are required to pay their balance off in full each month. As a result of this business model, American Express has not historically drawn the majority of its revenue from interest charges like its competitors. As a 1992 article from L.A. Times explains, American Express instead drew its revenue by charging merchants twice as much as Visa and Mastercard for processing payments.

The result? The 1992 article tells the story of a revolt among merchants, many of whom expressed a willingness to inconvenience their customers by rejecting AmEx in order to avoid those higher merchant fees. American Express gained a reputation during this time for not being universally accepted. Visa and Mastercard capitalized on the reputation by aggressively marketing their comparable convenience.

At the time, the L.A. Times article reported, “For merchants trying to cut costs in a recession, the American Express card may not be worth the added expense. The defectors point out that more than 90% of American Express cardholders also have either a Visa or a MasterCard in their wallets. Though some may prefer to use American Express, many others don’t mind reaching for a different brand of plastic.”

[Interested in learning more about the history of this iconic brand? Check out these 30 interesting facts about the American Express credit card company.]

Are there still major retailers who don’t accept American Express?

There are major retailers who don’t accept American Express for many of the same reasons cited above. While the grievances about AmEx merchant fees are more than three decades old, they still apply for some retail brands. American Express has made massive inroads toward acceptance, especially when it comes to national U.S. brands. The vast majority of major retailers accept American Express both online and at brick and mortar locations.

But some notable brands do not accept credit cards from American Express. For instance, the Costco big box retail chain does not accept AmEx cards either in person or online. However, this is likely more about exclusivity than merchant fees. Indeed, American Express was the exclusively contracted credit card of Costco until 2016, when Visa earned this right. To wit, Costco brick and mortar stores also do not accept Mastercard or Discover (though unlike AmEx, both Mastercard and Discover can be used online).

With that said, most major retailers in the U.S. do accept American Express credit cards including Amazon, Walmart, Target, Lowes, Apple, Best Buy, and much more.

While you aren’t too likely to run into a major retailer who won’t accept American Express in the U.S., you may encounter some small businesses and local restaurants that do not accept American Express. For small businesses, a higher average credit card transaction fee can be a significant expense, and even a deal breaker. For some smaller operations, the higher merchant fees that come with American Express acceptance may simply be unsustainable.

Is American Express accepted worldwide?

American Express cards are accepted in more than 160 countries, according to an article from WalletHub. And that’s a good thing, because AmEx cardholders often enjoy some of the best travel rewards around. Travel cards like the Delta SkyMiles Gold American Express Card, the Delta SkyMiles Platinum American Express Card, and the Marriott Bonvoy Bevy™ American Express® Card offer amazing reward dollars and welcome bonuses for hotels and flights booked directly through your account.

You will find that your AmEx cards are widely accepted in countries like Canada, Australia, the U.K. and India. However, the same high merchant fees that might deter small businesses in the U.S. may also limit acceptance of your American Express cards abroad. For instance, says the article from Wallethub, American Express is not accepted anywhere in Cuba, South Sudan, or Iran. If you are traveling to any of these countries or their surrounding regions, you’ll want to pack a backup credit card.

In fact, the numbers suggest that, on a global scale, both Visa and Mastercard are far more widely accepted. According to an article from Forbes, “Visa credit cards made up 38.73% of all transactions worldwide in 2022, according to the Nelson Report. Meanwhile, the Mastercard brand made up 24% of the market share. In comparison, American Express credit card transactions made up just 4.61% of all credit products around the world.”

This suggests that it’s a good idea to carry a few alternative credit cards during your international travels–particularly at least one card that does not charge foreign transaction fees. Not sure where to start? Check out our review to see which Chase Bank cards don’t charge a foreign transaction fee. One of these could be the perfect backup credit card during your travels.

Why own American Express cards if they aren’t accepted everywhere?

Simply stated, American Express offers some of the best and most generous membership rewards programs on the market. From massive welcome bonus opportunities to ongoing travel rewards; from exclusive access to lifestyle opportunities to points on everyday purchases, American Express card membership carries a wealth of benefits and perks.

While not everybody accepts American Express, those that do often make it well worth the while (and the annual fee) for the cardholder. For instance, the American Express Gold Card offers 90,000 membership rewards points as a bonus for spending $6000 in the first six months after account opening. You’ll also receive an annual statement credit for dining, for travel, and for lodging. Of course, that’s just the tip of the iceberg.

Get more details on the Gold Card and other elite status membership cards directly at the American Express website.