Visa criticizes Amazon for credit card ban


Visa disputed accusations that the fees charged credit card transactions are too high, leveled by e-commerce Giant Amazon.

Amazon recently revealed it will soon no longer allow UK-based customers to pay for items with Visa credit cards, citing “the still high cost of payments”. This later emerged the company could also end its partnership with Visa on co-branded credit cards in the United States.

However, Visa CEO Al Kelly has stood up for his company, which he says is determined to resolve the dispute with Amazon. He also illustrated the complexity of Visa’s position on fees, which are subject to a combination of external pressures.

“Obviously, we are in a difficult negotiation,” Kelly said. “What’s different here is that Amazon unfortunately decided to go public with the challenges of trading and oddly chose to threaten to punish consumers.”

“At Visa, we have a responsibility in unregulated markets to set prices, and no one is ever happy with us. If the price goes down, financial institutions are not happy, the price goes up, traders are not happy.

Visa credit cards on Amazon

Amazon’s decision to stop accepting Visa credit cards in the UK is just the latest salute in an ongoing dispute between the two companies.

In response to the increase in visa fees, Amazon recently introduced 0.5% surcharges on payments made using Visa credit cards in Singapore and Australia, which are the responsibility of the consumer. In both countries, customers were offered a discount on the first purchase made using an alternative payment method.

In the UK, meanwhile, Visa started charging an additional 1.5% on cross-border credit card payments between the UK and the EU, capitalizing on the fact that the fee cap imposed by the UK ‘EU no longer applies after Brexit.

Amazon also previously said it felt aggrieved by increases in visa fees that were justified by the need to protect against fraud and identity theft, since Merchant (not the payment provider) is legally responsible for cases of fraud.

At first glance, it would appear that Amazon is using the Visa credit card ban as a bargaining chip in the ongoing negotiations, but some believe the company has ulterior motives as well.

For example, the boycott of Visa could lead to increased adoption of Amazon’s own line of credit and payment cards, issued by Mastercard. In addition to incurring no surcharges, payments made using Amazon cards also allow customers to earn rewards and cash on future purchases.

In an exchange with City AM, Amazon has denied that the decision to ban Visa credit card transactions has nothing to do with its own payment cards.

Going through FT


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