According to the latest report, due to high transaction fees, Amazon will no longer support Visa credit cards in the UK starting next year, which means that the war between Amazon and credit card companies has begun to increase.
Moreover, Amazon also said that it is negotiating with several payment network companies, including MasterCard, American Express, and Visa, but the negotiations are only part of the “standard process” and the purpose is to assess US cooperative brand credit cards.
Amazon has imposed surcharges on customers in Singapore and Australia who use Visa credit cards on the grounds that Visa fees are too high. Amazon’s new UK policy will take effect on January 19, 2022. Amazon said that these costs should have fallen with the upgrade of technology, but on the contrary, it is still at a high level or even rising.
Stay tuned with us via Telegram
Beginning last month, for online credit card payment transactions or telephone credit card payment transactions between the UK and the European Union, Visa began to charge 1.5% transaction fees and debit card transactions 1.15%, an increase of 0.3% and 0.2% respectively.
Moreover, Visa has a large network of credit card users, and retailers are willing to pay high fees in order to reach a large user base, but analysts believe that this situation may change. Hargreaves Lansdown stock analyst Laura Hoy believes that Amazon’s move marks an important turning point in the payment industry. Amazon may want to attract more customers to its payment system.
Hoy also said: “In the end, I think Amazon has an advantage in this competition. Whether it is consumers using Amazon’s own payment system, or Visa’s concessions and lower fees, it is a good thing for Amazon.”
In 2016, Wal-Mart Canada gave up support for Visa credit cards because the two parties could not agree on the fee, and it took 7 months for the two parties to shake hands and make a peace.
Furthermore, Amazon told customers that Amazon customers can still continue to use Visa debit cards, MasterCard and Amex credit cards, and European credit cards. Visa responded in a statement that it was disappointed with Amazon’s move because Amazon restricted customer choices.
Regarding the issue of credit card issuers’ fees, the European Union has set a charging limit, but after Brexit, the EU’s policies will no longer be swayed by the European Union, and providers can raise the fees.
After Amazon issued a statement, the UK Trade Commission urged the British government to improve the terms of the UK-EU trade agreement. The committee stated in a statement: “Amazon wants to use its resources and capabilities to pass the law to avoid costs. If Amazon can’t do it, how can small businesses do it? The government should work hard to improve the UK-EU trade conditions and reach cooperation. The agreement so that British companies can remain competitive.”
