Amex’s Merchant Steering Rule Back In Play

The wake of last week’s ruling that American Express can continue to implement its no-steering policy — in which the payments giant can now dissuade merchants from moving its customers to cheaper payment types — is now moving full steam ahead, said The Wall Street Journal on Monday (Dec. 21).

The financial publication said that the company has told its employees governing merchant relationships that they should now look to enforce the anti-steering mandates that had been part of merchant agreements.

The rules, now back in play, may be a headline victory more than anything else, noted WSJ. The fact remains that merchants have been, as WSJ termed it, “hesitant to start steering customers away from Amex,” even though they were, before Monday’s lift, allowed to do just that. One key to that hesitancy has been the fact that merchants have been loath to alienate or upset customers who may not want to be steered to a particular card to use during a transaction. And as has been widely noted across the payments industry, some merchants — who, of course, pay a set percentage of each transaction — have been vocal critics of the fact that they have traditionally paid relatively more when customers opt to use their American Express cards than if they were to transact using other cards.

[bctt tweet=”The rules, now back in play, may be a headline victory more than anything else.”]

Monday’s ruling and Amex’s fast turnaround mark a twisted path. Earlier in 2015 the steering ban took effect once a lower level court said that such practices were anticompetitive. And before that, the Justice Department had sued the company over those practices. In a statement to WSJ, the company noted that “as long as the appellate court’s order remains in effect, American Express is no longer subject to the trial court’s injunction.”