Monday, August 15, 2022
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Amazon Drops Plan to Block UK Visa Credit Cards

As the two parties continue to work out a payment fee issue, Amazon has scrapped plans to suspend UK Visa credit card payments this week.

“On January 19, the anticipated change affecting the usage of Visa credit cards on Amazon.co.uk will no longer take effect,” Amazon stated.

Visa stated that it was “closely trying to achieve a deal.”

Last year, Amazon stated that Visa payment charges were a “obstacle” to offering customers the greatest pricing.

Visa, on the other hand, accused Amazon of threatening to limit customer choice. “Nobody wins when customer choice is constrained,” Visa added.

Neither business has said when the discussions would be finished. Amazon said it was working closely with Visa on “a potential solution that would enable consumers to continue using their Visa credit cards on Amazon.co.uk” in an email to customers on Monday.

Following Brexit, the UK is no longer subject to an EU-imposed fee ceiling on card issuers.

Following Brexit, both Visa and its competitor Mastercard increased the so-called interchange charge on cross-border transactions between firms in the United Kingdom and the European Union.

Last year, though, Amazon and Visa stated that their disagreement had nothing to do with the UK’s exit from the EU.

Amazon has previously refused to reveal how much Visa costs the store to process credit card transactions.

Visa likewise declined to comment, claiming that it takes less than 0.1 percent of a purchase’s value on average.

The Payment Systems Regulator is concerned about the lack of competition in this industry, which is dominated by Visa and Mastercard.

One of its aims, according to a plan released last week, is to increase competition among UK payment systems.

“We’ll focus more on strengthening competition between payment systems, rather than competition inside payment systems,” said Chris Hemsley, the company’s managing director.

“This is significant because we know that the future of retail payments is increasingly reliant on digital transactions, the majority of which are now conducted through card payment systems.”

Bob Carlson
Bob Carlson
Bob Carlson is a business journalist, with over a decade of experience in the trenches of reporting up-to-date business news for publications all over the world. With a wealth of knowledge at his back, Bob strives to bring the most important insights into the business world for TheOptic daily.
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