In the latest announcement, tech giant Amazon has announced to block customers from shopping using Visa credit cards. The company will stop accepting payments from Visa credit cards from January 19. However, this change in the payment system will be limited to the United Kingdom only. Also Read - Top deals on Amazon under Rs 1,499 on Bluetooth earphones
The e-commerce giant is blocking UK credit cards from Visa over the ongoing battle of interchange fees — levies charged by card issuers to a merchant’s bank for all transactions. Also Read - Amazon's cloud service launches new chipsets to compete with Intel, Nvidia
Why is Amazon blocking Visa credit cards?
Previously, Visa’s interchange fees for transactions between the UK and the European Union were capped at 0.3 percent by EU law. However, since the UK left the EU, Visa hiked the fee to 1.5 percent. Also Read - Amazon 'Mega Music Fest' offers deals on boAt, Sony, JBL headphones, speakers
Notably, Visa isn’t the only company to revise the fee. MasterCard also increased its interchange fees, but Amazon hasn’t blocked the company yet. In fact, Mastercard increases the fee even before Visa. There’s no clarity on why Amazon just blocked Visa and not other platforms.
Commenting on the matter, Amazon said that “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. 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.”
Highlighting further on the matter, an Amazon spokesperson told BBC News, “UK shoppers can use their Visa debit and credit cards at Amazon UK today and throughout the holiday season. We are very disappointed that Amazon is threatening to restrict consumer choice in the future. When consumer choice is limited, nobody wins. We have a long-standing relationship with Amazon, and we continue to work toward a resolution, so our cardholders can use their preferred Visa credit cards at Amazon UK without Amazon-imposed restrictions come January 2022.”
So, from January 19 onward, Amazon customers in the UK will not be able to use Visa credit cards. They will be able to shop using Visa debit cards and credit cards issued by MasterCard, American Express, among others.