Amazon and Visa at War in the UK – Banking and Financial Services

Amazon will no longer accept Visa credit cards in the UK from January 19. The subject of contention is the high fees charged by the payment company. Visa has already responded by saying that this is an “unfortunate” decision and is hoping the wrestling match with the retailer can be resolved.

The CEO of Visa has already described Amazon’s decision as “strange” and “unfortunate” but said he hopes the “problem” can be resolved.

“It is clear that we are in difficult negotiations,” Al Kelly told the Financial Times. “The different thing here is that Amazon has decided, unfortunately, to do the difficult negotiations that we’re having for the public, and, strangely enough, they choose the threat to penalize consumers,” he said.

Amazon announced the decision last week and offered affected customers a £20 credit to use for another payment method.

An Amazon spokesperson clarified, at the time of the public announcement, that card payment costs prevent customers from getting better prices and that these amounts should not remain high or increase even as technology advances.

What is certain is that, according to payments company Bambora cited by FT, in the UK Mastercard and Visa set fees for exactly the same payments.

“I find it strange that they claim to have done so because of the high transaction costs in the UK,” said Al Kelly. He concluded: “This is absolutely wrong.”

Visa and Mastercad have announced rate increases applicable to payments for transactions between the UK and the EU following the formalization of Brexit.