If you have to add that to your User Agreement, what does that say about your service?
There has been litigation around this routinely, including (IIRC) a US holding that says that merchants are allowed to say X is cheaper for them than Y if that statement is accurate.
Edit: that may have been reversed on appeal. https://www.bloomberg.com/news/articles/2016-09-26/american-...
1. Competing card companies offer much better cards than they used to, and include benefits that only Amex used to provide. For example, Visa Signature and Mastercard's competing product offer return coverage, extended warranties, free rental car insurance, etc.
2. One of the main draws of accepting Amex was that Amex's customer base was more affluent than that of other card companies, but that is no longer the case, partly because of #1.
3. Amex lost the Costco deal. That's a loss of a great deal of credit card fees, and 10% of Amex cards were the Costco card.
The court case was also seen as a blow, but maybe not if it got reversed on appeal. In any case, there are plenty of other problems for Amex to worry about.
http://thepointsguy.com/2016/01/maximizing-amex-platinum-in-...
I'm old and busy; I'll pay for covenience in life, which is why I've kept the card up to this point.
EDIT: Almost forgot: I have had the need to pay for a friend to be airlifted out of a central american country due to a medical emergency, and Amex was the only card willing to auth a low five figure amount with just a phone call to pay the helicopter fee. I have yet to find another financial provider who'll do that.
For many people traveling and eating out, the 4.5% will easily cover the $130 expense and so you easily make up the yearly fee.
I have a Barclays Aviator (old US Airways, now American Airlines) card, and although it has a $195/yr annual fee, I get $100 back for renewing my Global Entry card. This is in an addition to free checked baggage on American Airlines flights and group 1 boarding.
I usually fly enough that it pays for itself with the bag fees alone. The extra 1 year warranty on purchases has also saved me as well.
Chase reserve is 300 back in "travel" expenses which include parking/tolls/flights/uber. Assuming you have any of those expenses, it's a 150 card. Redeeming points is 1.5x more value if done through the reserve, travel/restaurants give 3x points. If you spend 4k a year on restaurants/travel, you'll break even.
So why get it if I have to spend >4k to break even? Because there is (was?) a 100,000 point signup bonus worth 1000 dollars cash or 1500 dollars in flights/more if transferred for a ticket. I'll break even on the yearly fee just from flights that I'm taking so it's 1000 dollars for "free".
If you're a chase ultimate rewards user, you should have the csr for the 1.5x redemption. If you like free money, you should have the csr and meet the spending requirement for the bonus.
By fiddling with credit cards, I'll save over 3k this year while traveling. There are people who do far, far more.
The important thing is that we're not going out of our way to justify the cards, we're simply operating our household expenses the same way we would be on a $0 card.
The difference is we use our points to buy everyone in our family pnice Christmas gifts, can get pre-sale access to shows/concerts (that is admittedly underutilized now that we have three kids), access to airport lounges, double up on hotel points, get discounted airfare upgrades, and things like expense categorization in the web portal. We get frequent discount offers for things we normally purchase, instant alerts for weird transactions that I can handle from my phone.
For us it pencils out. For someone or a family without the recurring expenses we have and doesn't travel very often, it wouldn't be worth it.
For people who travel a lot, for example, an annual travel credit + Global Entry fee covered + lounge access + redeemable points from spending on the card provides much, much more than $450 in value. Back when I flew more than I do now, several of the available cards had returns for me well above the cost of their annual fees.
[+] Cost of customer acquisition in credit cards is $250 on the low end.
Interesting. Would you consider it feasible to do so for a card you don't have yet (i.e. obtaining a new card without its associated annual fee), or would you only consider that plausible as an existing customer of such a card?
And does that apply to the large vendors (such as Amex or Chase), or only to smaller ones?
I am unaware of any CC issuer in the US of any size or segment which, as a matter of policy, refuses all requests of this matter. It comes down to policies and often a judgment call by a line cSR.
Since I switched a while back from flying American to flying Delta, I looked into getting Delta's branded card, which is Amex... except my current apartment doesn't take Amex for rent payments. So I'd be unable to hit the thresholds to make the card pay for itself.
I can just see it now: "PayPal is not a legitimate payment method! If you doubt this, see their Terms & Conditions where they explicitly state that you may not 'mischaracterize PayPal as a payment method.'"
Someone did a really crappy job of phrasing.
Legal work is an area of life where one should not apply Hanlon's razor by default. Not one comma or period in that work went unscrutinized by highly compensated executive talent at PayPal and any ambiguity you find is deliberate. Assume malice.
My wife is a mid-tier firm attorney in (a field). Any contract generally has a low-level associate take a pass at the material, which she then scrutinizes, polishes, etc. and then shares with her supervising attorney, who also scrutinizes and polishes. This is then shared with the client, who has their own staff to scrutinize, who are relevant executives, content experts, and often in-house attorneys of their own.
Several iterations of this cycle are the bare minimum. Because this process involves low-tier associates being taught by upper level attorneys, the "basic" stuff that top experts take for granted gets scrutinized and explained, as well, so even the parts you think of as "stock components" are being carefully looked over and considered at length.
There isn't a single word in those contracts that hasn't been reviewed by at least a half-dozen experts.
In fact, we do not get to see the actual changes to the legalese until they go into effect, or that's how I'd read the current agreement (emphasis added by me): "We may amend this user agreement at any time by posting a revised version on our website. The revised version will be effective at the time we post it. If we change the user agreement in a way that reduces your rights or increases your responsibilities, we will provide you with 30 days’ prior notice by posting notice on the Policy Updates page of our website."
So apparently we get to see vague and/or possibly misleading summaries and make our decisions based on those, but we do not get to see the actual text prior to deciding. I originally had hopes that we'd get to see it around the end of February (~30 days before it goes into effect), but the statement I italicized above indicates that we don't.
English is not my first language, does this mean that by calling PayPal a "payment method" i mischaracterize it? (is it a .. payment service .. whatever?) Or does it mean that I agree not to "mischaracterize" PayPal in general because I don't like it? (then why would I offer it)
It's probably incompetence though since this can work both ways. If PayPal tried to bring legal action with this clause, the first defense one would look at is to simply respond, "Where did I say it was a payment method? The clause says I can't mischaracterize it as a payment method, and I didn't."
In any case as it reads most simply it says you can't call PayPal a payment method. I doubt that's what they really meant to say.
If it actually is a payment method (as their lawyers undoubtedly take as a given), then it limits mischaracterization to aspects of PayPal that do not involve its character as a payment method.
Only if you already believe it is somehow "not a payment method" does the other reading make any sense.
Having said that, a quick skim suggests the term is used inconsistently. Sometimes it refers to PayPal as a payment method, other times it refers to the information you enter into PayPal (ie credit card, bank account, etc) as payment methods. This is because PayPal is both a payment method itself and a wrapper service for many payment methods. For example:
Your PayPal balance, if you used your PayPal balance as the payment method or a bank account as the payment method, once the money clears the bank.
1: https://www.paypalobjects.com/webstatic/ua/pdf/US/en_US/ua.p...
e.g. The party receiving payment ("seller") shall...
This one didn't.
I know sellers sometimes try to do the same thing with credit cards, charge extra fees to credit card users.
If you have to pay me cash, then I just make more on that transaction.
Let's say I sell trinkets for $10/each online. They are nice trinkets, but no one really needs my trinkets. No one is going to send me a money order in the mail for a single trinket for $10. Basically, there is no online market at all, unless I can make it easy to buy my product.
But if I charge $11/each and accept Paypal (or credit cards in general), I now have a real market for my trinkets. People like my trinkets, so they will gladly click on a Paypal icon and send me the money that way.
Now my trinkets are somewhat popular. A couple times a year someone stops by my workshop and asks to buy a trinket in person. I still charge them $11.
Also, I read that they will raise costs soonish.