ALEXANDRIA, Va.—Amazon said today that starting January 19, it won’t accept Visa credit cards issued in the United Kingdom, citing high swipe fees, the Wall Street Journal reports.
An Amazon spokesman told the Journal that “These costs should be going down over time with technological advancements, but instead they continue to stay high or even rise.”
Amazon will still accept Visa debit cards, American Express, Eurocard and Mastercard for customer payments.
In the U.S., credit card swipe fees remain one of the highest operating costs for convenience store retailers after labor, according to NACS State of the Industry data. Consumer preferences for more touch-free transactions and the coin circulation challenge in summer 2020 led to record debit and credit card usage at convenience stores. In 2020, 74.6% of all transactions were paid by plastic, and overall card fees paid by the convenience store industry were $10.7 billion, NACS SOI data indicate.
Lack of competition in the payments sector has allowed credit card swipe fees to skyrocket, negatively impacting business owners who, to compensate for swipe fees, must increase prices. Banks that issue Visa and Mastercard credit cards charge merchants an average 2.25% of the purchase price to process transactions, according to the Nilson Report, a global news and statistics provider for the payment industry. Multiplied across millions of transactions each day, those fees more than doubled from $25.6 billion a year in 2009 to $67.6 billion in 2019 for Visa and Mastercard alone. The overall processing fees paid by U.S. merchants to accept all card payments jumped to $116.4 billion in 2019, up 88% since 2009.