From Wednesday, January 19, millions of shoppers will not be able to make purchases using their Visa credit cards on the Amazon platform. This is due to unresolved concerns over rising cost of Visa transactions.
No Visa Payment
The decision, which was announced by the retail giant last year, is coming into effect after talks between the two companies to find a resolution to the impasse failed.
It however does not affect customers who use Visa debit cards, MasterCard and Amex credit cards, as well as Visa credit cards issued outside the UK. Amazon said:
As a result of Visa’s continued high cost of payments, we regret that Amazon.co.uk will no longer accept UK-issued Visa credit cards as of 19 January 2022. Customers can continue to use all debit cards (including Visa debit cards) and other non-Visa credit cards to shop on Amazon.co.uk.
The decision is estimated to cost Amazon some £1.4 billion, but the company said it is unacceptable that cost continues to go up in spite of technological advancements.
A spokesperson said they were unable to reach a favourable agreement with Visa over transaction fees.
The cost of accepting card payments continues to be an obstacle for businesses striving to provide the best prices for customers. These costs should be going down over time with technological advancements, but instead they continue to stay high or even rise
However, affected customers can update their payment information on the platform.
Visa hiked its interchange fee for online credit card payments to 1.5% last year-up five times from the previous 0.3% rate.
Reacting to the announcement by Amazon, Visa said it was 'very disappointed that Amazon is threatening to restrict consumer choice in the future. When consumer choice is limited, nobody wins.'