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I can't help but think that Amazon are shooting themselves in the foot with this;
https://www.bbc.com/news/business-59306200
One more reason, if one more were needed, not to support the Bezos Tax Dodge and Willy Shaped Rocket Development Fund.
No more EU credit card fee cap thanks to Brexit. Hopefully Visa will be the ones reconsidering.
Some suitable compromise will be reached and this'll be a non-event.
somone at visa is pushing a high discount rate and amazon have called their bluff. its a brave move, but I guess no-one ever only has a visa credit card, so it won't lose them (amazon) much custom.
I agree it'll eventually get worked out, but in the mean time visa credit will lose a lot of volume and gets them a bad rep.
Just changed to use my MasterCard. Visa Amazon war might be interesting.
Yeah, I got this email this morning. Seems like posturing from Amazon. Tossers.
Charging extra to the end buyer for credit card transactions will be making a return for other retail/fulfilment companies I expect. Just another cost of living increase... the options are to hide it in the price, charge for it transparently, or tell the card companies to get knotted. "Ripoff Britain" headlines will be back, just as soon as it can be done without people linking it to the Brexit the papers pushed for (it is linked, but time hides cause and effect quite well).
Would have thought it would be Visa are shooting themselves in the foot as other payment methods are available.
I'm not sure how I feel about this - on the one hand, good for amazon, card fees are massive for retailers - on the other hand I can see visa (if they don't already) giving preferential reduced fees to the largest global retailer on the planet.
Card fees & transactions have increased massively for my shop over the last couple of years.
Charging extra to the end buyer for credit card transactions will be making a return for other retail/fulfilment companies I expect. Just another cost of living increase… the options are to hide it in the price, charge for it transparently, or tell the card companies to get knotted.
To pass on fees to the consumer legally, your only allowed to charge transparently now.
I can see visa (if they don’t already) giving preferential reduced fees to the largest global retailer on the planet.
discount rates available vary massively depending on retailer size. A small merchant might be paying 2.5%, a major retailer will be paying <1% already. Its all a negociation, but getting in front of customers means someone has done a really bad job
afaik the advertised price has to be the complete price (ie, including all payment fees) - however that doesn't stop people offering discounts for other payment methods. A retailers agreement with a card network may preclude them from doing this though (ie, their deal with mastercard blocks them from offering the same product cheaper if you use amex)
Visa Amazon war might be interesting.
"It's a pity both sides can't lose."
-Henry Kissinger
Amazon credit cards coming soon?
Amazon credit cards coming soon?
they're already offered. Mastercard network for consumer and amex for small business
I would suspect that Amazon demanded the service for free. They're big enough to sway the user's choice so why pay any fees at all? They're probably their own PSP already, so that only leaves Visa's interchange fees to pay, so sod em. Demand they cut it to Zero or we (amazon) cut you off from our customer base. Your choice Mr Visa.
I have cancelled my Amazon account just yesterday as it happens. It occurred to me (without having heard this story and yes quite late to this party Im sure) they're too big to be any good for society now, so in my own small way Im out.
Got that email today, for all their negativity, Amazon i think are doing the right thing, my guess would be that it's not horrific for them to keep Visa, but it's a who blinks first thing, and Amazon have the might to fight them.
I only really have the bank card on amazon though, but it must be a worry for Visa, as i think my next credit card would be mastercard or the likes if this is the future.
Playing hardball aren't they? Visa trying to cash in a Brexit bonus.
"Visa debit cards would still be accepted."
One side-effect here is that a lot of customers could potentially lose the protection afforded by credit cards.
To pass on fees to the consumer legally, your only allowed to charge transparently now.
You can hide it in the price that all your customers pay. You can then exclude credit card payers from discount codes etc.
By “transparent” I mean “this includes a 2% charge for paying by the payment method you have chosen”, so that consumers know what their card use is costing.
Yeah, I got this email this morning. Seems like posturing from Amazon. Tossers.
It looks like VISA have increased their fees five-fold.
What would you do if you were Amazon?
Good, credit card companies take the piss.
I would suspect that Amazon demanded the service for free. They’re big enough to sway the user’s choice so why pay any fees at all?
well visa earn the vast majority of their money from the discount fees, so no acquirer would sign up to a deal of this nature. I suspect amazon did not do this, but rather tried to negociate a rate on par with other networks.
By “transparent” I mean “this includes a 2% charge for paying by the payment method you have chosen”, so that consumers know what their card use is costing.
I don't think anyone really cares at a consumer level. I don't mind whether my £100 is going towards the raw cost of the product from their supplier, advertising, paying card fees, shipping, VAT or anything else. Its a wrapped up cost, and if I can't do anything to change it, why would it make a difference?
before the EU deal, mastercard and visa had variable discount rates for credit card use - ie my 2% cashback visa credit card would pass a higher fee to the merchant than somoene elses boggo visa credit card (to cover the cashback). This wasn't easy for merchants to handle, and was thus banned (which resulted in the end of most non-amex cashback cards). I think now we're out of the EU visa are trying to re-introduce these (as they're popular with consumers, and will grow their network) - maybe it'll stop here? not sure.
Amazon never had to implement 3D secure either as they argue it broke their 1-click checkout patent. There are some clever people involved in it as a company and they are also at the point where they can argue against card issuers.
I'm not advocating for Amazon, but Visa and MC have had an close to a monopoly for years and mandated how things are done, so it's good they are challenged too.
First Direct switched to MasterCard for debit at least earlier this year. I wonder if there's something else going on as well.
Regardless, having two credit card providers (MC and VISA) with AMEX a distant B2B third isn't healthy. Amazon ain't healthy either, yet here we are. I'm actively trying to break our Amazon habit in my household, not least because often it's not the cheapest and I occasionally end up with poor quality or counterfeit stuff. Bookshop.org is worth a shot if you want to support local bookshops, and eBay often has the same Tut for less from smaller merchants. Then there's the joy of buying stuff secondhand....
I don't buy from Amazon,it's one of my tiny and insignificant protests.
I am sure Dr Evil will still make it to the moon.
@5lab , you don't mind how much of the money you are paying goes to the card provider? What if they upped their charge to 10%? Still happy to carry on supporting them, rather than swap to another card provider? If course you can "do something about it"... but you/we/I won't while the fees are hidden from us. There are three ways to pressure the card issuers not to take the piss... tell customers what the charges are (and leave them to decide to act based on that information if they wish), or refuse the card, or keep hiding the cost. Nearly everyone is currently doing the last of those... the big guys can chose to cut Visa credit out... smaller retailers are unlikely to take that route... so that leaves... telling customers...
@5lab , you don’t mind how much of the money you are paying goes to the card provider? What if they upped their charge to 10%? Still happy to carry on supporting them, rather than swap to another card provider?
pretty much, yeah. As a consumer I don't have visibility of what their costs are, how much profit they make, and so on. Just like I don't expect a breakdown showing what you're sending DHL's direction if you use them as a shipping agent, nor a breakdown showing how much of your profits go to amazon or ebay or shopify or etsy if you're using them as a front for your shop.
You might be a small merchant, so this stuff is near and dear to you, and I get that, but for me as an average punter, I just don't care. Tell me the total cost, (incentivise me to use a payment method thats lower cost to you if you want), and I'll take my pick.
The costs that a merchant may incur from a given payment method are not simple. Part of it will go to their payment processor (ie paypal) if they're using one. Part of it will go to that payment processor's acquirer. part of it will go to the payment network (ie visa), part of it will go to the customers bank, and part of it may come back to me, the consumer, in the form of cashback or other incentives. Where should the breakdown stop?
amazon are working on a Mastercard with Barclaycard in this country at the moment to roll out a card with a substantial rewards program and a couple of other newish features.
Due to the nature and size of the venture there's been some pretty significant concessions made.
Chances of rolling back on the Visa announcement are pretty much nil.
Following on from my earlier point, as MC have already done this, and it only affects (AFAIK) cross border interchange, I cant see how Amazon won't have asked for it for free. I _think_ that they're processing cross border so they can call it a transaction somewhere else in the world for tax purposes. That was ok when we were inside the EU as charging extra was deemed a penalty for the remote country so banned.
VISA and MC have said it used to be capped and now its not, so back to the old days of 1.5% interchange (or whatever the new number is). Fair enough TBH - just don't run your txns cross border. Oh wait, you want to do that to avoid tax. I remember now.
So if you're amazon you say no thanks. I want my cross border charges for free I will only pay you my base rate (which I wouldn't be surprised at all if it was close to nothing at all). MC says yes as long as we play nice on other things, Visa says no.
Im with Visa on this one.
Maybe Ive read that wrong but it seems to me like Amazon are just being caught in their own complex web. My Visa rates havent gone up as far as I know unless I sell overseas. Now the EU is the same as everywhere else thats fair enough. I don't like it but I expected it post-brexit.
no-one ever only has a visa credit card
Actually I only have one credit card and that is Visa. As I am currently not earning, I am not sure how easy it would be to get another.
(I have several debit cards, including some Mastercard, and PayPal etc, but these don't offer the credit protection that a credit card does).
if anyone would like a referral for a platinum cashback (or any other) amex card DM me. i get money, so do you. 😀
Actually I only have one credit card and that is Visa. As I am currently not earning, I am not sure how easy it would be to get another.
(I have several debit cards, including some Mastercard, and PayPal etc, but these don’t offer the credit protection that a credit card does)
agreed, but do you really need the credit protection when it comes to someone like amazon? They're hardly a fly-by-night operation and its rare their customer services don't just swallow any losses.
I personally use a card with protection there, but I'd not suggest its necessary, unlike a lot of smaller merchants. I'm aware a lot of people may only have one credit card, which happens to be a visa, but I think they'd all have a debit card as well.
This thread actually has me considering an Amazon MasterCard, so thanks OP for starting it.
no-one ever only has a visa credit card
The only credit cards I have are Visa ones - both personal and company. I do have personal visa debit cards. Won't be a major headache for personal stuff but will be a total PITA for company stuff (all the silly crap like when someone needs a keyboard/mouse/USB stick/laptop charger etc). Personal stuff, credit card protection gets lost but I don't buy much expensive stuff that would matter for anyway. However whichever one of them comes out of it to the public seeming like they are putting money before quality of customer service/experience/utility will be the loser. I think that could be either, if this is right:
VISA and MC have said it used to be capped and now its not, so back to the old days of 1.5% interchange (or whatever the new number is). Fair enough TBH – just don’t run your txns cross border. Oh wait, you want to do that to avoid tax. I remember now.
and if Visa are reasonably clean on their own tax affairs I think the right PR people could easily make the public perceive this as Amazon's problem.
Won’t be a major headache for personal stuff but will be a total PITA for company stuff (all the silly crap like when someone needs a keyboard/mouse/USB stick/laptop charger etc).
if you spend a lot as a company on amazon, have a look at the amex small business amazon card. https://www.amazon.co.uk/Amazon-Business-American-Express-Card/dp/B07V3GD6PJ
Good, credit card companies take the piss.
I like particularly how Visa saying it restricts consumer choice, yet themselves insisted that fans had to use Visa to buy tickets, when they sponsored the London Olympics.
http://www.bbc.co.uk/news/1039497 0">
I like particularly how Visa saying it restricts consumer choice, yet themselves insisted that fans had to use Visa to buy tickets, when they sponsored the London Olympics.
I think only Visa was allowed to purchase anything within the olympic village in Tokyo - no alternate cards or cash allowed.
Amazon UK take payments in GBP via a Luxembourg subsidiary - this is part of their tax strategy.
Since Brexit, the removal of the European Interchange fee cap for cross border Ecommerce / credit card payments effectively lifts the rate from 0.3% to 1.5% - which Amazon will be charged.
If amazon UK was the charging entity (exposing them them to additional UK tax), the rate would stay at 0.3%.
If VISA are going down the raise the fees route they will find they are like Amex were until around 2 years ago. No small business would touch Amex payments due to the crippling commission fees (7% anyone). We had their cards turned off on our terminal and we can do the same for VISA too.
One more reason, if one more were needed, not to support the Bezos Tax Dodge and Willy Shaped Rocket Development Fund.
100% this.
One more reason, if one more were needed, not to support the Bezos Tax Dodge and Willy Shaped Rocket Development Fund.
100% this.
& another 100% from me.
Surely that tax loophole can be closed now though?
We should all go back to writing cheques. What's the rush?
Postal orders anyone?
I reckon this might end up not happening, in the meantime I'm happy to take £20 of their money for changing