Visa and Amazon have settled their year-long dispute over credit card payments through the e-commerce site.
The two shopping giants have signed an agreement that will see Amazon accept Visa credit cards at all of its locations without charging customers any additional fees.
The rift between Amazon and Visa began when the e-commerce giant announced policy changes regarding high processing fees for payments introduced by Visa.
In October 2021, Visa increased fees on transactions made by UK buyers and EU businesses from 0.3% to 1.5%.
At the time, Amazon said the increase was a “hurdle” and negatively impacted consumers. Visa responded by accusing Amazon of hampering consumer choice.
The online retail giant later threatened to suspend the use of Visa credit cards in the UK, adding that Amazon customers in Singapore and Australia would have to pay extra for using them. a Visa credit card to purchase products.
However, now that an agreement has been reached, Visa cards will now be accepted and the surcharge will be removed from Thursday 17th February.
Commenting on the news, an Amazon spokesperson said: “We recently entered into a global agreement with Visa that allows all customers to continue using their Visa credit cards in our stores.
Visa added, “This agreement includes Visa’s acceptance in all Amazon stores and locations today, as well as a joint commitment to collaborate on new products and technology initiatives to ensure innovative payment experiences for our customers. in the future.”
Prior to Brexit, fees charged by card issuers between UK consumers and EU businesses were capped by EU law. This was later removed as Britain is going it alone.
There was significant consumer reaction to the argument between Visa and Amazon, as people saw a chance that they would be affected by the changes.
A OnePoll study found that around six million Amazon customers intended to stop buying products from the site or reduce the frequency of purchases through the platform.
At the time, Visa accused Amazon of restricting customer access, saying “when consumer choice is limited, no one wins.”
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Commenting on the impact of the written agreement, Siamac Rezaiezadeh, Director of Product Marketing at GoCardless, said it was important that we now keep the big picture.
“Companies are now pushing back against adverse terms, ones they historically had no choice but to accept,” Rezaiezadeh said.
“The landscape has now changed dramatically with the rise of BNPL and open banking enabled payments, both of which are increasingly popular with consumers. This gives businesses a real alternative to card schemes.
Rezaiezadeh added: “Replacing expensive cards is now a viable, and perhaps better, option for every business, especially as they do more business online – an environment for which cards have no need. simply not designed.
“The continued maturity of innovations such as open banking, coupled with business and consumer demand for more ‘digital-first’ payment methods, means that we soon expect to see a shift from ‘card registered” to “registered account”.
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