Have you heard about the simmering tensions between Visa and Amazon?

I got an email from Amazon to say it plans to stop taking Visa-branded credit cards from Jan 2022 and will offer me a £20 off on my next purchase if I switched payment methods.

What’s the matter?

Amazon says, the cost of accepting credit-card payments should be going down over time to allow merchants to reinvest savings into low prices and shopping enhancements for customers. Yet despite technical advancements, some cards’ cost of payments continue to stay high or even rise.

Retailers pay each time a consumer swipes a card at checkout. While it can amount to just pennies per purchase, that adds up: Merchants spent a whopping $110 billion in card-processing fees last year alone. 

So with its dominance in e-commerce, Amazon pays billions in such fees each year, and represents “a low-single-digit percentage of all Visa’s revenues from domestic credit cards.

At the heart of the dispute: Amazon wants to pay less to accept Visa cards and this fights seems to be about who keeps the profits or rather profits from the process?

Presenting this week’s #fincuts to share a quick view on what their public fight is. I’m interested to see how this will play out. Looks like Visa may have something to come back?