Merchants permitted to steer customers from American Express

The result of a federal antitrust case could change the way merchants treat acceptance of American Express. In short, merchants complained of substantially higher fees to accept American Express, but were not allowed to steer customers to lower cost card brands. A judgement was entered April 30, 2015 in favor of the plaintiff. An open ended stay of the permanent injunction pending appeal was denied.  However, the court allowed for a 30 day temporary stay of the permanent injunction on May 19, which just expired.

Excerpt from the American Express Anti-trust judgement

As reflected in § III.A of the Permanent Injunction, the court has determined that in order to implement an effective remedy in this case—in other words, “to allow Merchants to attempt to influence the General Purpose Cards that a Customer uses by providing choices and information in a competitive market”—merchants must be allowed to steer toward particular brands of debit cards, in addition to steering between brands of credit cards. (Permanent Injunction § III.A.)
The Permanent Injunction does not, however, expressly protect steering to other forms of payment, such as cash and check, although other sources of law provide such protection in certain circumstances…

Finally, the court expressly does not include brands of debit cards within the scope of
§ III.A.7 of the Permanent Injunction. Thus, while a merchant has the right under the Permanent Injunction to communicate to customers the cost of accepting American Express, or the relative costs of accepting different brands of credit cards (and the merchant may do so on an average, rather than transaction-specific, basis), American Express can prohibit merchants from including costs associated with acceptance of debit cards in this calculation, since blending the costs of accepting credit cards and debit cards would likely overstate the difference between the merchant’s overall cost of accepting American Express and its cost of accepting other brands, such as Visa and MasterCard, that have both credit and debit cards.

Keys for merchants who want to adopt steering

  • Merchants can offer discounts or rebates to customers
  • Merchants can display signs stating ‘preferred’ card brand
  • Merchants cannot blend debit and credit rates to communicate cost of acceptance differences
  • Other laws are applicable, including the Durbin Amendment to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. “Retailers can encourage their customers to use other forms of payment, such as cash and checks, and can discount for PIN debit, cash and checks.”

Merchant Card Brand Steering Challenges

Under the Durbin amendment, customer receipts must include a subtotal, discount amount, and final total. Merchants need a software or cloud based solution that can make the calculations and output the correct receipt.

If offering discounts for steering, removing decision making and calculations from cashiers is critical for both compliance and cash management.

CenPOS Steering Solutions

CenPOS is a merchant centric, cloud based payment engine with fully compliant steering technology, including the ability to identify which cards qualify for discounts, and automatically calculating the discount.

  • Analyze transaction data by user/department, day of week, and hour of day, to determine if and when steering is cost effective.
  • Offer steering discounts only when and where it’s financially beneficial instead of 24/7 in all locations.



United States of America, State of Arizona,    State of Connecticut,    State of Idaho,    State of Illinois,    State of Iowa,    State of Maryland,    State of Michigan,    State of Missouri, State of Montana,    State of Nebraska,    State of New Hampshire,    State of Ohio, State of Rhode Island,    State of Tennessee,    State of Texas,    State of Utah, and    State of Vermont
American Express Company, American Express Travel Related Services Company, Inc., MasterCard International Inc., and Visa Inc.