Visa and Amazon have reached a global agreement that allows all customers to use their cards on the store after the online retail giant announced in November that it would stop accepting Visa credit cards issued in the United Kingdom, citing high fee charges.
The company has also will also drop a 0.5 percent surcharge on Visa credit card transactions in Singapore and Australia, which it introduced last year, CNBC reports.
“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,” an Amazon spokesperson told The Epoch Times at the time.
“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.”
Visa had said that it was disappointed by the decision and accused Amazon of restricting customers’ choice.
However, it said it was working with Amazon to come to a resolution on the matter.
Visa last year raised the interchange fees it charges merchants for processing digital transactions between the UK and the European Union from 0.3 percent to 1.5 percent. The interchange fee for cross-border debit card payments made online increased from 0.2 percent to 1.15 percent.
Interchange fees, also known as swipe fees, are a percentage of the cost of the transaction that the merchant’s bank account must pay whenever a customer makes a purchase from their store using a credit or debit card.
Card networks were allowed to raise their charges after an EU-enforced cap on interchange fees ceased to apply in Britain following Brexit.
Merchants, such as U.S. supermarket chain Kroger Co. have previously been criticized by payment processors like Visa over transaction fees.
Last year, Kroger said it was pulling the plug on accepting Visa credit cards at its Smith’s Food and Drug Stores division due to the high fees but also later made a reversal on that decision.
“Visa is pleased to have reached a broad, global agreement with Amazon,” a spokesperson told Reuters in an email. “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.”
Last month, the UK Treasury Committee said it would examine the fees that Visa and Mastercard charge businesses after the country’s Payment Systems Regulator (PSR) said it had found no evidence to justify the increased fees.
The Epoch Times has contacted spokespersons from Visa and Amazon for comment.
