October 3, 2022

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Amazon and Visa resolve dispute over credit card fees Amazon

Amazon will continue to accept Visa credit card payments Through their sites after the companies concluded a new global deal.

come this step Months after the online retailer threatened to stop using UK-issued Visa credit cards Due to fees charged for processing payments.

Amazon said the fees were an “obstacle” to offering the best rates to its customers, while Visa accused Amazon To restrict the choice of the customer.

However, the two companies have since come to an agreement, ending weeks of negotiations, Including last month’s agreement to delay the ban for UK users.

A Visa spokesperson said: “Visa is pleased to have reached a broad global agreement with Amazon. This agreement includes acceptance of Visa in all Amazon stores and locations today, as well as a shared commitment to collaborate on new product and technology initiatives to ensure innovative payment experiences for our customers in the future.”

“We recently reached a global agreement with Visa that allows all customers to continue to use their Visa credit cards in our stores. Amazon remains committed to providing customers with a convenient payment experience and providing them with choice,” Amazon said.

Amazon customers in Australia and Singapore previously had to pay an additional cost when purchasing items with a Visa credit card. This has also been removed.

The uproar came on the heels of the removal of the EU cap on fees charged by UK card issuers after Brexit.

Visa has increased its transaction value fee for online credit card payments between the UK and the EU to 1.5%, from a previous fee of 0.3%. The companies did not disclose how much Amazon is paying for the processing.

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In an email to site users in November, Amazon blamed the payment processing cost: “As of January 19, 2022, unfortunately we will not accept Visa credit cards issued in the UK due to the high Visa fee processing fees for credit card transactions.”

Which consumer group? Welcome the news that UK customers can continue to use Visa credit cards on the site.

To Clark, Senior Editor at Which? Money said: “Using a credit card to pay provides shoppers with valuable legal protection that debit cards cannot, and eliminating this option for Visa cardholders would have meant fewer rights for millions of consumers.

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However, there have been long-standing concerns about credit card fees, and this is affecting customers and businesses. The regulator should urgently move forward with its proposals to examine whether the card fees are fair and what impact this has on competition.”

The payment systems regulator launched a review of card fees in 2021 and found they had “significantly increased” since the EU cap was raised. It is considering whether action is needed on the issue.

“We have always said that if we see a fee issue that requires attention outside of our market review, we will consider what action we should take.” The regulator said in November .

Meanwhile, the British Retail Consortium said companies faced an estimated £150m increase in the cost of accepting card payments across borders. British retailers were subject to an additional fee of £36.5m, equivalent to £100,000 a day.