Amazon has dropped its threat to stop accepting Visa cards across its global operations after reaching an agreement with the card scheme.
Amazon last month deferred previously announced plans to stop accepting Visa card payments in the UK due to what it perceived to be punchy charges for processing credit card transactions in post-Brexit Britain.
Those plans have now been dropped completely following Amazon's agreement with Visa. Amazon will also drop a 0.5% surcharge on Visa credit card transactions in Singapore and Australia, which it introduced last year.
Given Amazon's pulling power, it is likely that the online giant has been offered new terms by Visa in relation to scheme charges.
“We’ve recently reached a global agreement with Visa that allows all customers to continue using their Visa credit cards in our stores,” Amazon said in a statement. “Amazon remains committed to offering customers a payment experience that is convenient and offers choice.”
Visa says its agreement with Amazon would see the two collaborate on “new product and technology initiatives to ensure innovative payment experiences for our customers in the future.”
For Siamac Rezaiezadeh, director of product marketing at GoCardless, the agreement reflects the waning ability of the global card schemes to set aggressive payment terms, as consumers move to more 'digital-first' payment methods.
“As this chapter of the Amazon and Visa feud closes, it’s important to keep one eye on the bigger picture: businesses are now pushing back against unfavourable terms, ones they historically had little choice but to accept," he says. "The landscape has now changed dramatically with the rise of BNPL and open banking-enabled payments, both of which are increasingly popular with consumers. This gives businesses a genuine alternative to the card schemes."