Amazon has announced it will not stop accepting Visa credit cards for payments in the UK later this week, as had been planned as the two companies seek to resolve a dispute.
In an email to customers, the online retailer said it was “working closely with Visa on a potential solution.”
The decision was due to take effect on January 19, with Amazon blaming Visa’s “high fees for processing credit card transactions” when it was announced last November.
Amazon’s last message to customers did not say the dispute had been resolved for good.
But he said: “If we make any changes related to Visa credit cards, we will let you know in advance.”
Visa also released a brief statement saying, “Amazon customers can continue to use Visa cards on Amazon.co.uk after January 19 while we work closely to reach an agreement.”
He said at the time the online giant announced the ban that he was “very disappointed that Amazon was threatening to restrict consumer choice in the future”.
The online retailer was reportedly particularly angry at an increase in so-called interchange fees – additional cross-border costs – which it says have increased fivefold since Brexit.
Such fees, payable by Amazon itself or by merchants on its platform, would squeeze margins – or raise prices if passed on to customers.
Losing the right to be used for payments on the UK retail platform would have been a blow for Visa.
A study by Mintel consultants published last year showed that 89% of UK consumers shop on Amazon.
Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown, said of the dispute: “Both sides have not fully backed down, but the final talks over the weekend appear to have been productive and Amazon certainly emerges as a your much more conciliatory. .
“The higher fees charged by Visa remain an issue, and a long-term solution is likely to involve some movement here, but it is in neither company’s interest for a war of attrition resumes, with the prospect of major losses in British business for each side.
“It’s a stubborn headache that Visa will want to see lifted as it grapples with competition from start-ups and more established rivals.”