Home Credit card Last-minute deal needed for UK-issued Visa credit cards to work on Amazon | Amazon

Last-minute deal needed for UK-issued Visa credit cards to work on Amazon | Amazon


Millions of people’s credit cards will stop working on Amazon’s UK website from this week – unless there is an 11am resolution to a bitter dispute between the retailer and the giant Visa payments.

In November, Amazon announced to customers that from January 19 it would stop accepting payments made with UK-issued Visa credit cards, in what was described as a “chicken game”. ‘business”.

It is not known how many people are affected by the payment ban, but in March 2021, Mintel said 89% of Britons shop on Amazon, and its analysts put the number of Amazon Prime members in the UK at around 21 million. Last month it was claimed that Amazon stands to lose nearly £1.4 billion from UK shoppers as a result of its move.

There is speculation, however, that a last minute deal could be reached between the two parties. On Friday, Amazon and Visa declined to provide an update on negotiations.

Amazon blamed its decision on “high fees charged by Visa for processing credit card transactions.”

The move potentially embarrasses millions of people who use a Visa credit card issued by vendors, including Barclaycard, to purchase items from the website or pay for their Amazon Prime membership.

The retailer said it would continue to accept all debit cards (including Visa debit cards) and non-Visa credit cards, including Mastercard and American Express branded ones.

Affected customers currently using a Visa credit card have been advised that they must update their payment method or any new orders placed on the site will be rejected from January 19. They will also lose access to Amazon Prime benefits, including faster item delivery, thousands of TV shows and movies on Prime Video, and the Amazon Music Prime streaming service.

At the time of the announcement, Visa said it was “continuing to work towards a resolution”, while Martin Lewis, the founder of MoneySavingExpert.com, said he suspected the decision was a possible negotiation tactic by Amazon to get Visa to lower its fees.

To date, there has been no news of a deal, and on Thursday, a blog in the specialist magazine The Grocer said it was a “corporate game of chicken” – an argument where neither side wants to be the first to back down.

Nonetheless, a credit card industry insider told the Guardian: “We hope there will be a deal.”

In emails to customers, Amazon acknowledged that removing the ability to pay for products with a Visa credit card and forcing people to update their contact information can be inconvenient and “a little awkward.”

Card payments incur a range of fees, including interchange fees, which are paid by companies to card issuers each time a card is used by a consumer, and which are higher for card transactions credit.

Card fees have long been a point of contention between providers and retailers, and last week MPs waded into the row. The Commons Treasury Select Committee said that in October, weeks before Amazon’s announcement, Mastercard and Visa raised cross-border interchange fees for debit and credit card transactions by 0.2 % to 0.3% and 1.15% to 1.5% respectively. He added that fees paid by companies to card payment operators for using the service had also risen substantially.

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Visa said in November it was “very disappointed that Amazon is threatening to restrict consumer choice in the future.”

Many shoppers choose to use credit cards for large online purchases because of the added protections they offer should something go wrong.

Amazon’s move is also a blow to people who use their Visa credit card to spread the cost of their expenses, or to accumulate points, airline miles or cash back.