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The rumor is that Apple Card will move to Amex. WSJ says 12-15 months, but AppleCard is contractually obligated to use the MC network until 2025. I can't imagi
by parl_match 3y ago
The rumor is that Apple Card will move to Amex. WSJ says 12-15 months, but AppleCard is contractually obligated to use the MC network until 2025.
I can't imagine they'll close all those accounts, so likely we'll see some sort of migration leading up.
- giobox 3y agoThis would be a bit of a detractor for me, Amex is not as widely accepted, especially when traveling in Europe. Mastercard is accepted virtually everywhere in the EU and UK.
- wdb 3y agoYeah, I had an Amex card and it was pretty useless in Europe. Admittingly that was more than five years ago so maybe things have improved by now.
- giobox 3y agoThe fact the Apple card was a Mastercard and had no foreign transaction fees was largely the only reason I opened it, as I too find my Amex a pain in the ass in Europe. If it does become an Amex card, I will likely close the account.
- ghaff 3y agoFor me, Apple Card is mostly only interesting for the discount on Apple. I carry it as a backup otherwise but don't use it.
- throwaway2037 3y agono foreign transaction fees In an FX transaction, what is the difference between a trading fee and a wider spread? Nothing. (Why do people keep falling for this?) What you really want to see is a combined promise. For example: No fees, plus 1% or less FX spread on major currencies. (My preferred credit card promises that.) Honestly, it is very hard to pay a total of less than 1% on foreign transactions. Still, this is pretty cheap, given the convenience.
- dublinben 3y agoYou can look up what MasterCard's conversion rate is: https://www.mastercard.us/en-us/personal/get-support/convert-currency.html https://www.mastercard.us/en-us/personal/get-support/convert... For a major currency pair, like EUR-USD or JPY-USD, you can see that it's less than a tenth of a cent off the 'real' rate.
- e63f67dd-065b 3y agoThe FX spread is fixed at around 25-50bps for Mastercard/Visa due to a settlement long ago. The foreign transaction fee is an additional charge on top of that, usually 3% of the gross transaction volume in USD. The banks don't control the exchange rate, it's determined by the card network. So yes, when a card advertises 0% foreign transaction fee, it really does mean that they don't take an additional charge on top of the spread (which they don't control or profit from). It's in fact quite easy to pay less than 100bps for a foreign currency transaction; everybody with a 0% FTF card is doing it right now (especially for high volume corridors like EUR/USD). > No fees, plus 1% or less FX spread on major currencies. (My preferred credit card promises that.) You bank can't promise what they don't control; Visa and Mastercard determines FX rates, and they're below 100bps because of an old settlement. So the bank is promising you something they had no role in creating; you're the one here falling for the marketing, not everybody else.
- yawn22222 3y agoI think as a card provider you still make money on this, from what I remember the card provider can settle directly with the scheme for foreign transactions the next day. There's still a good margin on the mastercard rate, I've definitely observed more than 50bps spread, but that's GBP -> THB etc.. Would a fulltime forex trader cost more though?
- traceroute66 3y ago> Honestly, it is very hard to pay a total of less than 1% on foreign transactions. I would argue that you are not looking hard enough if you're paying 1% on FX card transactions. All you need is a multi-currency card from one of the Fintechs, that will get you down to 0.5% or less without any effort. Of course if you're the sort of person who likes taking cash out of ATMs on holiday then you'll have to look harder, since there is usually a surcharge on ATM withdrawls. But even then its not impossible.
- petemir 3y agoAt least in Switzerland, Amex is still a pain to use.
- Sayrus 3y agoIn France, the fees required to accept Amex are still way higher than MC/VISA. They are still not widely accepted and not a lot of persons know about Amex.
- ROFISH 3y agoThe fees are higher everywhere. Their pitch is "our fees are higher, but we have higher-end customers who spend more", which roughly tracks with reality. But a hot dog stand isn't gonna have whales but an upper-end store might, so it's not surprising to see less support it.
- jltsiren 3y agoThe hot dog stand might actually accept Amex. High-end businesses accept Amex, because it's worth it. Major chains can probably negotiate good deals. Tiny/seasonal businesses often use middlemen like Zettle that charge high fees and accept almost every payment method imaginable. Those in the middle who use traditional payment terminals and pay list prices may still avoid Amex due to the high fees.
- nemothekid 3y agoI thought the EU had regulations on credit card fees? As I understand it, the Amex isn't widely supported because Amex's fee-heavy business model wouldn't be allowed to launch. Visa's highest tier cards (Visa Infinite cards, such as the Chase Sapphire Reserve), already have higher fees than the Amex Platinum. The difference is, Visa won't let merchants ban single cards (you have to accept ALL Visa cards), while banning Amex meaning you are banning mostly high tier cards and losing nothing on the low end.
- kalleboo 3y agoThe EU regulations are on interchange fees that are paid between the issuing and the acquiring banks. With Amex, Amex themselves are both the issuer and the acquirer, so there is no interchange to regulate. https://curia.europa.eu/jcms/upload/docs/application/pdf/2018-02/cp180012en.pdf https://curia.europa.eu/jcms/upload/docs/application/pdf/201...
- byteCoder 3y agoInteresting. I had zero issues using my Amex in France and Switzerland this past summer. In fact, there was only one restaurant that I visited that wouldn't take it. I must have been lucky.
- madeofpalk 3y agoHow long were you there for? Out of how many stores? Still, that’s a significant enough failure rate to be a detractor.
- kmbfjr 3y agoI have used my AMEX in The Netherlands and Belgium…once. The foreign transaction fees are steep.
- CobaltFire 3y agoI have to ask which AMEX. I used my Platinum overseas quite a lot (they give all AMEX cards free to US Military) and never had cause for complaint.
- mrweasel 3y agoAt least it might solve an issue a friend of mine has. He really wants an AMEX card, due to traveling, but you can only get corporate cards here, AMEX doesn't deal with private individuals and won't issue you a card. I suppose he can just get an Apple card then. The beauty if going with AMEX, if that's what they'll do, it that it's a one stop shop. No need to go through a bank to issue a credit card, just deal with the credit card company directly. Currently the card is pretty much useless, but it does fit Apples way of doing things, cutting out the middle man. For American Express it could also help make them relevant as a card company again. If they have plans to expand beyond the US, this might be a good way to do it. Companies will want to be able to accept Apples card, even if that means signing up with AMEX. Then in a few years, AMEX can start pushing their own branded cards which will now be more widely accepted.
- petemir 3y agoI hate that it works this way, but perhaps an Apple-Amex deal is what is needed for businesses to start accepting Amex. Edit: typo
- notatoad 3y agolower fees is what is needed for businesses to start accepting amex. visa and mastercard are 2-3%, amex is 5-6%. there's no upside for merchants to accept transactions where they have to pay double the processing fees
- sgerenser 3y agoThe difference is not that high. In fact, my understanding is “Visa Signature” and “World Mastercard” (which are most of the premium credit cards) normally cost about the same as Amex. At worst it may be about 1% more not double.
- kuschku 3y agoCompared to european payment cards with their 0.125% total fees, Amex' 6-7% is a steep ask.
- arcdigital 3y agoIt's nowhere near 6-7%. See my other comment for more details.
- ceejayoz 3y agoThe highest Amex interchange rate is about 3%. https://www.creditdonkey.com/interchange-rates.html https://www.creditdonkey.com/interchange-rates.html
- kuschku 3y agoMerchant rates from local payment processors are: 0.125% for Girocard, 1.39% for VISA/MasterCard, 6.2% for AMEX
- yieldcrv 3y agoMy experience with Amex the last 5 years is that its just as well accepted in Europe as it is in US. Not data driven, just been to a lot of countries for extended durations. The random restauranteur or merchant that doesnt take it is just as rare and random in both environments.
- edvinbesic 3y agoI agree, but would this still be the case if using it through Apple Pay vs swiping the physical card?
- madeofpalk 3y agoYes. Amex is already on Apple Pay all around the world, and it’s only accepted at stores that accept Amex.
- ceejayoz 3y agoApple Pay won't override the merchant's point-of-sale system's configured accepted networks; for example, it won't help you use an Amex at Costco. (It will help you if the merchant says "we don't take Amex" but their terminal actually does, though. Surprisingly common at small shops.)
- troupe 3y agoIn the US, that situation has dramatically changed in the last 3 years or so.
- madeofpalk 3y ago2025 is 15 months away!
- delfinom 3y agoThe rumor was GS was trying to sell the contract to AMEX. There was no indication that AMEX was biting.