Amazon to stop accepting Visa credit cards in June

Visa continues to plan a version of its credit card reader that will work only with its debit and credit cards, it says in letter to Card Payment Processor Council

Amazon will stop accepting Visa credit cards from 8 June, Visa has warned retailers.

According to a letter sent to the Card Payment Processor Council (CPPC), released by the UK Cards Association (UKCA), Visa Inc. states that it has made the decision “based on costs” to “avoid inadvertent harm to consumers”. The CPPC, a group of card payments processing companies that collectively charge the banks and credit card companies, has been lobbying Visa to allow its plastic to be accepted at retail outlets in the UK.

The decision is a surprise. Last year, Visa CEO Alfred Kelly dismissed a plan by Amazon to use contactless payments to pay for items on its site, warning that it could negatively affect wallet usage among younger people.

The use of credit cards in the UK is generally accepted in domestic transactions and in other markets such as Australia and the US. In the UK, Visa credit cards are accepted at about a third of retail outlets in large cities and 35% of retailers in smaller towns and villages.

Visa says it will continue to encourage retailers to participate in the UK Cardholder Scheme (UKCS), a national scheme that requires UK customers to use Visa or MasterCard credit cards to buy products in shops.

On condition of anonymity, a UK card issuer told the Guardian that his bank – which is a member of the CPPC and sometimes takes cash-back payments for Visa credit cards issued by MasterCard, a smaller competitor – had been left with very little choice but to stop processing transactions for Amazon.

“It’s pretty upsetting for banks,” the bank official said. “Why is this starting suddenly now? We’re all going to be affected.”

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