Amazon bars U.S. card holders from buying on UK website, rerouting them to its own payments platform

Amazon.com announced on Tuesday that it will be barring U.S. credit card holders from shopping at its British Amazon.com website in a dispute with Visa over an effort to widen the definition of its…

Amazon bars U.S. card holders from buying on UK website, rerouting them to its own payments platform

Amazon.com announced on Tuesday that it will be barring U.S. credit card holders from shopping at its British Amazon.com website in a dispute with Visa over an effort to widen the definition of its own payment transactions. The online retail giant said Visa imposed a “clear disadvantage” by deeming its transactions as being Visa-based rather than Amazon-based.

The current policy is “uncompetitive, harmful to U.S. consumers and harmful to Amazon’s customers,” Doug Herrington, Amazon’s general manager for the U.K., Ireland and Luxembourg, said in a statement.

Customers who have used Visa cards to buy goods on Amazon’s U.K. website will automatically be redirected to their own cards in the Amazon Payment Card page when they try to make a purchase. Those who have used their MasterCard or American Express cards will have their payment transactions redirected from their issuer’s website to Amazon’s.

Amazon said it has contacted Visa “several times” over the issue and the two companies have agreed to “work toward an amicable resolution.”

“We remain open to a resolution,” a Visa spokesperson said in a statement to Fox Business. “There are always issues in handling a varied array of payment methods. We take this very seriously and will continue to work with companies and customers to reach an amicable solution.”

The U.K. online retailer is the largest online seller of e-books, electronic home furnishings and Christmas presents in Britain. Amazon is also the largest shopping mall in the world, with a billion active customers who made more than 40 billion online purchases between 2014 and 2017.

This is just the latest in a series of conflicts between Visa and Amazon. This dispute also comes as an official investigation in the EU has suggested that Visa is anti-competitive in its handling of the credit card market and asking for the card giant to be forced to change its practices.

In a move that analysts say could help the company earn more cash, and immediately hit American consumers with price increases, Amazon announced last fall that it would start charging 5 pounds in the U.K. to U.S. customers who want to make online purchases using a credit card. Visa, however, is arguing that the move is illegal.

This is not the first time a major U.S. company has blocked a Visa credit card. Chipotle Mexican Grill, for example, recently stopped accepting Visa credit cards in some U.S. states, ending a relationship that started in 2000. But Chipotle said it was comfortable with the rationale behind the decision and that it still accepted Visa cards when opening stores in new locations.

Amazon has been moving away from the Visa system as its own, which it acquired in 2006, continues to grow. Visa said that it has a similar partnership with Apple Inc.

The extent of the Visa dispute appears to be vast – as do the restrictions the company places on other customers. Amazon said it removed all Visa credit card transactions in Europe and some areas of the U.S. in 2017 but will not affect other customers using Visa cards.

Visa purchases show up as eBay transactions. If someone is authorized to use their Visa card, the PayPal transaction will also be put on the card’s VISA account page, but a “PayPal merchant will be removed.”

Amazon said that from next week, it will “ban Visa Payments in general” in all markets it operates in. But it added that Visa Payment cards will still be accepted in Canada, Spain, Portugal, Ireland, and China.

– CNBC.com

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