Amazon is planning to stop accepting Visa Credit cards from the 19th January 2022.
The company has been battling issues with the high fees that come with Visa Credit card transactions. They are still going to accept Visa debit cards, though.
Amazon said that prices should be dropping for customers, but they are remaining the same or even rising in some cases. This is due to the higher fees that come with the usage of Visa‘s credit cards on their site.
Catching You Up on the Details
The Business Insider spoke to an Amazon spokesperson, who stated that they are offering customers who have a Visa Credit card listed as their preferred payment (or have it listed at all in the payment portion of the site) a ‘gift card’ in exchange for them to change their details over to another card.
In turn, the news of Amazon not allowing Visa’s credit cards as a payment option on their site has caused the financial company’s stocks to drop 6.7%. Visa responded to Amazon’s decision, claiming that they were “very disappointed that Amazon is threatening to restrict consumer choice in the future”. They also think “when consumer choice is limited, nobody wins”.
Many stores, whether online or physical, tend to offer an array of payment options. In turn, allowing customers to use whichever payment service they prefer. Retailers commonly do not accept American Express, (especially in the UK) but it is uncommon for Visa to be affected in a similar way.
Visa also informed users that they are trying to work with Amazon to resolve the issues; they have had “a long-standing relationship with Amazon”.
An analyst’s note published on The Wall Street Journal suggests that Amazon’s net sales in the UK are roughly a tenth of sales in the US. Meaning that the ban will not sustain a huge impact if it does go ahead.
The Public Opinion
We spoke to some residents in Canary Wharf to see what the general public think about Amazon’s decision to cease purchases from Visa’s credit cards.
One resident told JLDN: “I think it limits your purchasing options. Anything that limits your purchasing options is a degradation in service. So I think it’s disappointing, and will probably lead me not to buy.”
Another said: “Me personally, I use Amazon’s credit card for anything I buy off of Amazon. So it’s not going to affect me. But I can understand how it will affect some other people who have Visa cards.”
Amazon have not revealed the amount that Visa charge in fees. However, it has been released that it has been less than 0.1% of the overall price of a transaction.
The two corporate giants are currently continuing with their negotiations. Thankfully, there is still a lot of time before 19th January for a conclusion to be made.