That would be cool. Amex support way better than GS that’s for sure.

Would suck for retailers though. Amex fees among the highest when compared to other networks and issuing banks.

On the consumer side, I tend to see Amex as not widely accepted. Especially drops when traveling.

Apple Card was already charging high merchant fees. https://www.imore.com/retailers-are-paying-premium-you-use-y...

Now it’s going to get even higher with Amex network fees

I got an Amex card and I think it kinda sucks. Many businesses in Thailand don't accept Amex, I think due to the high fees. At some point I want to change my card (once I can get a credit card from a bank in Thailand, cause my Amex card is from The Netherlands).

Would be much better if Apple would get with MasterCard. Based on my experience, no issues anywhere.

Doesn’t work in Costco. Visa works everywhere.

Costco only accepts whatever credit card the Costco credit card currently is. Right now that's Visa, but it used to be American Express before 2016, ironically.

Supposedly this exclusively allows them to negotiate down the fee really low.

It's Mastercard in Japan

https://www.costco.co.jp/GlobalCard

mastercard in canada too

Surely the grand total of Costco’s US credit-card fees can’t amount to more than a percentage-of-a-percentage of all credit-card spending in the country?

...otherwise WalMart and other major retailers (Amazon?) would have partnered with a single credit-card network to benefit too

Walmart and Kroger have had their own disputes with Visa (for one example) and (at least Kroger) started blocking some of their cards at select chains in order to negotiate a better deal. Costco has super tight margins. The the point that when their execs are talking about the price of goods they don't say, "[Item] is $70." No, they say, "[Item] is 69.99." Their culture is about every last penny of the margin. Their money comes from memberships.

Costco UK accepts all three card networks (Amex/Mastercard/Visa). I wonder how their UK division can do this if Costco prefers to do exclusivity deals that allow them to lock in a low fee?

Europe has lower fees by legislative fiat. UK still has these (mostly) due to the majority of these caps existing pre-Brexit.

Amex’s business proposition to sellers is “we charge high fees but a lot of rich people have Amex so you (the seller) should suck it up and accept us anyway”

Sure that works if you’re selling perfume or handbags, but if you’re a family restaurant then rich people and regular people eat the same quantity of food, your margins are low, why accept it?

Moreover Amex is pretty rare outside of certain markets. If only foreigners use Amex, and your business is not catered to foreigners, then you probably aren’t going to support it or in some cases even know what the hell it is.

Whelp, here in Germany many Starbucks and McDonalds, as well as some restaurants(middle to high end) immediately decline(or block Amex payment at counter), though if I am a bit sneaky and use Apple Pay method they can't see it and sometimes actually work.

The issue with other cards here(Germany) is, everything is fake credit, i.e. my Visa/MasterCard is just "Debit" and immediately books paid amount from my bank and some also comes with hefty monthly fees because they issue a shiny/designer "Debit" card. My bank indeed issues a real MasterCard but the monthly fees are unreasonable added on top of my already expensive checking account fees and it has very crappy app where trying to temporarily (un-)block my card needs calling their support and waiting in line while amex app gives me these features immediately on app.

Amex however gives me real credit(though they book the whole amount on start of next month) and also payback points in exchange for minuscle monthly fees but they have free same card with less sexy design which doesn't signal my ego correctly.

What you describe for your particular Amex card isn't a real credit card either. That's a charge card. Germany doesn't do real credit cards much (if at all?)

It does, he could get one from Hanseatic Bank for free, DKB had a proper credit card for years (now with s fee). They are mostly fee-ridden, since germans don’t like them very much (cultural thing?) and they are offered as an extra.

Beside the culture (losing everything twice in the last 100 years),

I think money transfer plays a big role. Germany never had a culture of cheques and switched from money to money transfers early on (before WW1), so most stuff in Germany either I pay by money transfer ("Ueberweisung") or a company takes the money from my account ("Bankeinzug") - like mortages, cars, rent, electricity, travelling etc. In the US credit cards partially replaced cheques (and added credit, duh!), which was never something in Germany. The only use of cheques in Germany were traveller cheques when travelling - and then only to get money at the hotel.

Even for the catalog business people payed by invoice and money transfer (and the catalog companies gave you credit).

What is left, like groceries, is often paid in cash.

It's a total difference of point of view.

In Europe, banks don't like you taking out credit cards. Borrowing money is viewed as a weakness and it's best to never do it.

In America it's considered a virtue to have many credit cards and shuffle them so you can be seen to pay it off. Really weird.

> In Europe, banks don't like you taking out credit cards. Borrowing money is viewed as a weakness and it's best to never do it.

Don't know about that, "Europe" is a big place. Credit cards are pretty common in the UK at least, and stuff like balance transfer cards (for shuffling) are too. Maybe not to American extents, but hardly a weakness.

In fact, looks like more people in Iceland, Norway and Switzerland own credit cards than the US: https://www.statista.com/statistics/675371/ownership-of-cred...

Well the UK is a similar state to the US.

I don't believe this about Switzerland though. They are a very typical people that abhors spending money you don't have. But I think they may be counting debit cards there.

Credit cards have a crucial benefit over debit cards: they add a layer of indirection to my bank account.

Steal (or mischarge) my credit card, run up 10k in charges, no problem. No money ever comes out of my bank account and I dispute the charges/report the card stolen.

Steal my debit card, run up 10k in charges...there's 10k gone out of my account until the bank resolves the situation.

Here they won't let you dispute charges. There's no purchase insurance included either. Or those cashback awards like you get in the US.

> My bank indeed issues a real MasterCard but the monthly fees are unreasonable added on top of my already expensive checking account fees and it has very crappy app where trying to temporarily (un-)block my card needs calling their support and waiting in line while amex app gives me these features immediately on app.

Get yourself an N26 account/card if it bothers you too much. It works as a Mastercard (still the "Debit" kind though), has no account fees and you can do basically everthing from within their app.

I prefer a debit cards. Makes it easier to track my spending, and no risk of overspending.

Plus, probably lower fees…

One thing that never made sense to me is that im sure 99% of all the rich people who have amex also got at least another card. If you dont take amex wont those people just use another card.

Two things:

1) the backup is likely a high end rewards / corporate card whose fees are as high or higher than Amex for most categories of spend; and

2) it’s kind of weak for the last interaction with a business be them saying they won’t take your preferred form of payment because they imagine it boosts their margin by .3%.

Yeah I have never met someone using an amex card that didn't have a backup visa or mastercard.

Sure, they’ll do that once. It might annoy them so they don’t come back. This might bother some business owners and not others.

> but if you’re a family restaurant then rich people and regular people eat the same quantity of food

rich people can afford adding two half strips of bacon for almost half again the price of the burger. they can also afford to leave a third of it on the table (daaaang that off-label semaglutide does magic) and then do it all over again tomorrow.

doesn’t mean they will. but they could. they have the means to do so.

that is what amex is advertising, even if it isn’t quite what they provide.

Same in Europe. I have an Amex card from work. Hotels and most restaurants accept it, most taxis and shops don't. They absolutely hate that card and even if they accept it you practically have to beg them to take it (and even then they will pretend "the machine is broken"). Even in big countries. Try to get a taxi in the queue at Charles de Gaulle airport in Paris. They will ask you to stand on the side and beg each taxi driver until they finally get one for you.

Also the damn thing never works in machines, like for public transport tickets :( Which is often a far better option than taxis.

I have to use that card for business expenses and I hate it so much.

As an American, I only use my Amex at businesses I dislike, but am forced to patronize for whatever reason. And groceries. It's pretty good for groceries.

> On the consumer side, I tend to see Amex as not widely accepted. Especially drops when traveling.

As a B2B SaaS owner, I don't accept Amex, because they make me jump through extra hoops. I process all cards through Braintree, but Amex requires an extra agreement directly with them, and they make the process of signing those agreements really difficult and obnoxious. I have better things to do with my time.

I did a quick search, here's a partial list of what was required:

· Please provide a scanned copy of Passports for authorized signers and Beneficial Owners.

· Please provide a scanned copy of Certificate of incorporation

· Please Provide a Completed Multi Currency form, Attached

· Please provide a completed and Signed Side Letter, Attached

· Please provide a completed and Signed W8 BEN form, Attached

(BTW, I am not based in the US, so "W8 BEN" reads like Klingon to me).

Piece of advice - read up on that W8-BEN.

W-8 BEN doesn't apply to him because it's for foreign individuals who receive non-business income. He needs a W-8 BEN-E most likely.

Imagine being outside the US and thinking "prove you're an incorporated business, prove the major players in your company exist, and fill out this tax form for foreigners"

...is "extra hoops" and "really difficult and obnoxious"

> (BTW, I am not based in the US, so "W8 BEN" reads like Klingon to me).

If only there were technology to look up what 'W8 BEN' means in seconds

> Imagine being outside the US and thinking "prove you're an incorporated business, prove the major players in your company exist, and fill out this tax form for foreigners"

> ...is "extra hoops" and "really difficult and obnoxious"

Compare with how willing US citizens or businesses are to comply with similarly basic things when another country asks for them.

Selling on Amazon in dozens of countries requires only one from, that from the US. No other country.

Even if I don't sell in the US. Even if I never go to the US. Even if I have no company in the US.

Imagine everyone in the US selling on Amazon needing to sign a German form, and a French form, and a UK form, and a Spanish form etc. with no intention to sell in these countries.

Just saying, the UK has a form of business called a "Sole Trader" where you don't even need to notify the government about until it's tax time. Something like a "Certificate of incorporation" doesn't even exist for that.

So yeah, sometimes it fucks things up.

In the UK you can register whatever limited liability company you like on Companies House without any formal process except handling tax accounts (or sometimes VAT). No proof required at all for this, you’ll only need it to set up a company bank account (and that will just be notarised ID).

It just so happens that the UK is therefore an incredibly easy place to dodge tax if you are so inclined.

From a french perspective, that seems like tuesday.

W-8BEN form is the most obnoxious form I've ever seen. It's written in incredibly opaque and obtuse language and covers far too many scenarios.

And the most incredibly annoying thing about it is that for most UK companies (dont' forget if you are a limited company you need the W-8BEN-E variant!) you probably only have to fill in about 5 short fields. So it only really needs to be half a page. However working out which fields is virtually impossible and I'm still not entirely sure I fill it out correctly.

If every other payment provider accepts the vendor's terms and that the vendor already has KYC details on file with its US-authorised payment gateway, AMEX requiring signed scanned copies of its own payment terms and multiple forms of identity to be individually emailed to them for each and every transaction is the definition of 'extra hoops', and it seems quite reasonable to consider it difficult and obnoxious.

For a lot of transaction sizes it isn't really worth the extra effort, particularly as filling in forms like the W8 BEN E is the kind of work people tend to pay their accountant - quite possibly more than the value of the SaaS subscription - to do. (As someone who happily prepares his own tax returns once a year, the W8 BEN E is not a particularly straightforward form to fill in for comparatively little benefit)

Lots of replies, and most are misguided, so I'll add:

I am a B2B SaaS business based outside the US. Tax withholding is not applicable between my customers and me, or at least it is not my responsibility. VAT is solved by reverse charge.

I do have payment processing set up (with Braintree). The above AMEX requirements were on top of that — a completely separate procedure, just because AMEX feels different.

As to the W8 BEN discussion, be careful with your biases: it might seem "obvious" to you that everyone needs to comply with whatever IRS requires of US businesses, if you live in the US. But I have customers in 44 countries. If you are American, before you state that something is obviously required, take a look at this (from recent E-mail):

"Self-Certified Filled Form 10F will be required"

"Permanent Account Number or Aadhaar Number of the assessee if allotted"

"Period for which the residential status as mentioned in the certificate referred to in sub-section (4) of section 90 or sub-section (4) of section 90A is applicable"

Still looks obvious? Those are from India, and I'm pretty sure these requirements seem totally obvious to my Indian customers.

> Amex as not widely accepted. Especially drops when traveling.

Only nutters use Amex whilst travelling (or at least non-US nutters)

The double-conversion gotcha is a real killer.

Everything gets converted back via USD.

So for example, if you have a EUR Amex card and you go to the UK, the AMEX flow is: GBP -> USD -> EUR.

And they take, IIRC 3% from you on each leg of that double-conversion.

Is that an EU-issued specific phenomenon? Even when I travel to the EU and use Amex (or Apple Card or a number of others) this doesn’t happen. Think it falls under the “no foreign transaction fees” feature set.

The only remaining “gotcha” that I run in to is sometimes a shop will try and get you to pay for something at the point of sale in USD instead of the local currency since they can (within reason but exorbitant) set the exchange rate. Tip- pay in local currency.

> Is that an EU-issued specific phenomenon?

Not as far as I'm aware. It certainly happens with GBP-issued and having briefly looked at some of the agreements, it happens with various Asian issued cards too.

To clarify:

      - If the transaction is in your "home" currency, you get charged in that.
      - If the transaction is in USD, you get charged in that.
      - Everything else is subject to double-conversion

Example wording below from the GBP card (the last phrase of the last paragraph is the important one). I see they no longer charge double-fees, but you will still loose out on the double currency conversion because there will be a double-spread on there:

     If we receive a transaction or refund for processing in a foreign currency, we'll convert it into Pounds Sterling on the date it's processed (which may be different to the date of the transaction or refund).

     This means that the exchange rate used may differ from the rate that applied on the date of your transaction or refund. Exchange rate fluctuations can be significant.

     If the transaction or refund is in U.S. Dollars, we'll convert it directly into Pounds Sterling. In all other cases, we'll convert it into U.S. Dollars first and then into Pounds Sterling but we'll only charge one non-sterling transaction fee.

I don’t think this is universally true. I had a CHF Amex for years. Used it by in EUR and USD online and in person.

> CHF Amex

The Swiss Amex is a bit special anyway because its operated by Swisscard which is a JV between Credit Suisse and AMEX.

Yeah, outside the US, plenty of shops outright refuse Amex.

Back when POS terminals read magnetic stripes, most in Europe didn't even support the Amex stripe in hardware, because it was different :)

Even now with contactless and chips (Amex has discovered chips right?) the only places I see Amex logos are 4+ star hotels and very posh restaurants. So it will be kinda useless outside the US.

Majority of large retailers in the UK take AMEX. Probably over 75% of my consumer spending goes through my AMEX card - Petrol, Food etc, never had an issue.

Can't speak for the rest of Europe.

> On the consumer side, I tend to see Amex as not widely accepted. Especially drops when traveling.

I’ve found the main difference being cash only venues versus card+cash accepted.

I just got back from Japan and traveled to Tokyo, Kyoto, Osaka, Hiroshima, Kawaguchiko, Miyajima, and it was somewhat rare to find a business that accepted cards but didn’t accept Amex, much to my surprise!

It matters a lot less than it used to. With the exception of working on the Olympics I’ve been able to use an Amex for most travel expenses since 2000. What was more of a pain was the lack of EMV chips in US credit cards for a long time.

What did you do for the Olympics?

Was a “webmaster” for the Atlanta and Nagano sites and managed an application development team for Sydney.

My bet is more that GS wanted out, and Apple wants to save face because "the leads we brought GS have double the default rate of other cards" is a bad look for future partners.

> Apple wants to save face because "the leads we brought GS have double the default rate of other cards" is a bad look for future partners.

Pretty sure I must be misunderstanding you. Do you really mean to suggest that Apple's reaction to Goldman breaking up with them was to start briefing the press that they dumped Goldman first with the intention of somehow hiding or diluting the poor default performance of the card?

0. Do you mean charge off, or default, or delinquency? I think you mean charge off rate, so I'll address that, but let me know if not - you did say "default rate", which is almost always higher than net charge off (default is whenever a consumer fails to pay on time, net charge off is effectively bad debt hitting 6 months of arrears: after six months it's unlikely to be defrayed without debt recovery action). Anyway, assuming you meant net charge off:

1. Apple cannot possibly avoid disclosing the charge off rate of this program to potential partners during diligence. (Quite the opposite of a cover-up, the commercial agreement between Apple and any new partner will likely attempt to explicitly codify management's representations on this metric, and scope what happens if performance is not as described. Other than aggregate balance information I cannot think of a more important metric for an interested party to understand, nor one more likely to result in the demise of the agreement and fixed penalties for misrepresentation if it is presented deceptively.)

2. More importantly, the information you seem to think Apple is preoccupied with keeping out of the public eye appears to be publicly available in Goldman's SEC filings.[^1]

3. More importantly still, Apple is understood to have made several stipulations of Goldman at the outset of the deal which are likely to contribute to higher than average charge off rates: firstly, Apple and Goldman do not pursue debt recovery as aggressively as other card issuers, which is meaningful given that charge offs, unlike defaults, are judged over 6 months.

Secondly, Apple seems to have encouraged Goldman to "get to a yes" on lending to individuals who otherwise may not have qualified for a credit card. (Low credit scores, high risk demographics.)

These are likely to be points of negotiation with any new partner, but it's trivial to see why Apple card's net charge off rate (2.93%) is in line with subprime cards like Capital One (2.2%) rather than JP Morgan's 1.47% and BoA's 1.6% when you consider that they deliberately accept high risk profiles and deliberately avoid pursuing them as robustly as JP Morgan and co.

(BTW, saying "[Apple card customers] have double the default rate of other cards" seems misleading to me – I can only find one such example, and it requires me to round up to 2x, but I may not have the same data as you? I think this should at most be "some other cards", given that e.g. Discover is significantly higher than Apple at 3.5%…)

4. There's some evidence to suggest that net charge offs spike during the infancy of new lending programs like Apple card, because net charge offs spike when individual consumers get new credit cards (for a lot of reasons), before cohorts mature and a steady state performance is reached. (This is also a consideration in multiple predictive models aiming to forecast net charge-off rates.)

These are the good (to me) reasons that Apple is unlikely to be attempting to spin a yarn to the press to "save face".

Without any inside information, I can also see reasons to believe that Apple did terminate the relationship with Goldman proactively, although it seems to be indisputable that Goldman was attempting to exit the business:

a. It has been widely reported that the risk and ADM logic was so poor at launch that Tim Cook was unable to qualify for a card. This is not great for Apple's image.

b. There were multiple horror stories in the press about various forms of prejudicial evaluations: DHH's partner springs to mind. This is not great for Apple's image, particularly when they were preoccupied with making Apple card accessible to the widest possible range of consumers (i.e. high risk).

c. Goldman screwed up withdrawals so badly that Apple began issuing $100 "gifts" to people's accounts as compensation. This is not great for Apple's image.

d. Goldman's infrastructure is inflexible and Apple negotiated weird consumer-centric benefits (e.g. bills at the start of the month, not on a rolling basis: Goldman's customer support teams reportedly can't cope with this concentration of demand). Apple does not play particularly well with others on matters like this.

e. *Edit:* Totally forgot to add that Goldman's consumer credit division is literally being investigated by the CFPB "and other governmental bodies relating to investigations and/or inquiries concerning GS Bank USA’s credit card account management practices." Cool.

Finally, I'd say that Goldman's inner turmoil and urgent desire to exit its consumer businesses is another reason for Apple to want to get out early: consumer has been an unmitigated disaster for Goldman, racking up billions of losses/write-downs, prompting a very embarrassing strategic retreat and eroding much of shareholders' confidence in David Solomon.

I can't think of many reasons why Apple would want to continue the agreement through 2029, particularly given that Goldman somewhat publicly shopped the sale of the program to American Express.

Goldman Sachs is not very good at consumer banking and does not want to do it. That makes them a lousy partner for Apple's consumer banking proposition, and I suspect this story is exactly what it sounds like: Apple putting Goldman out of their misery.

[^1]: https://www.sec.gov/Archives/edgar/data/886982/0000886982230... p168, states the net charge off ratio on consumer credit cards to be 2.8%.

Do you declare any interest in the situation or potential conflict of concerns?

Why do you ask?

Since the post was way too long to be without motives, presumably.

irritation is a motivation without financial incentive.

I suspect you're right, and I find it to be so sad that anyone could read a fairly well-structured rebuttal to a throwaway conspiracy theory to be evidence of someone having a vested interest.

You're making a value statement about two different positions. Without having adopted such a value statement, I poked at an outsized response. You would need to say why it's a conspiracy theory, any why it's well-structured.

I’m all about equality when it comes to specious conspiracy theories.

I mean you listed plenty of reasons the relationship is bad. But those are all pretty good reasons for GS to want to bail! Like "Apple is a PITA demanding all bills come due on a specific day for everyone" does not lead to "Apple wants to terminate the relationship".

As anyone who has dealt with vendor integrations would tell you, when one side has a list of demands about how something should work, you know it's going to be a headache. Though I am still legit confused as to how GS ended up being the partner (beyond the cynical "every other company laughed Apple out of the room", which is not a great sign for Apple either!)

I have no inside info, but like you I know that GS is pulling out of consumer stuff in general. Let's just say that in a relationship where GS was constantly, constantly, constantly leaking complaints to the press, it's not a huge logical jump to think that GS would want to end such a relationship.

This is all just gossip of course. None of this matters, and I have no horse in the race. It's just fun to think about.

> I mean you listed plenty of reasons the relationship is bad.

Perhaps we misunderstand each other. This is what you said:

> Apple wants to save face because "the leads we brought GS have double the default rate of other cards" is a bad look for future partners.

I believe that I demonstrated that this conspiracy theory – which is entirely unsubstantiated, and which seems to have been largely refuted given that the charge off data is public – cannot possibly be the reason.

Do you still believe that Apple is somehow trying to conceal charge off rates, having read my post?

> it's not a huge logical jump to think that GS would want to end such a relationship.

This is a very reasonable point, but it is not the one you made. It's totally fine to not be au fait with the minutiae of consumer credit reporting at Goldman Sachs, but it would help me to calibrate what your contention is if you could address specific points instead of abstracting to generalisations when it appears to me that you are entirely misinformed.