Online retail giant Amazon will continue to accept UK Visa payments after a global agreement was reached.
Amazon said in November 2021 that it would stop accepting UK Visa credit card payments because card fees remained “an obstacle” to providing the best prices for customers.
The ban was due to start on 19 January 2022, but last month Amazon said it would not ban the use of Visa credit card payments in the UK while the two companies worked on a resolution.
A Visa spokesperson said the companies have now reached a “broad, global agreement”.
“This agreement includes the acceptance of Visa at all Amazon stores and sites today, as well as a joint commitment to collaboration on new product and technology initiatives to ensure innovative payment experiences for our customers in the future,” said the spokesperson.
Following the agreement, Amazon said it is committed to offering customers a payment experience that is convenient and offers choice.
In November, when the proposed ban was announced, an Amazon spokesperson said: “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.”
This was largely met with surprise by experts. Gareth Lodge, financial services analyst at Celent, said that although it is not uncommon for smaller retailers to refuse to take certain cards, “it is very surprising that one of the biggest retailers in the world stops taken payments from a card with such a high share of credit card payments”.
But Peter Kimpton, personal finance expert at Family Money, told Computer Weekly last month: “Although a market leader, Amazon needs to be able to remain competitive with its many online competitors, as well as small businesses that people are trying to support more and more, especially after the pandemic.
“With this in mind, they need to be able to charge the lowest prices possible and still make a profit, so it makes sense that the first thing to try and make cuts on is transaction fees.
“Visa has responded by criticising Amazon for restricting consumer choice, however I don’t feel this will be a problem, with many consumers opting to have more than one credit card as well as multiple debit cards. I predict Amazon will see no decrease in sales due to this change, and we might even see other large retailers following suit.”
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