On a crisp autumn morning in London town, I awoke to an email from someone whom I hate but just can’t quit: Amazon.
The company was writing to notify me of some important news: it will soon stop accepting Visa credit cards for UK payments.
Customers will still be able to use Visa’s debit cards, but the firm’s credit cards are getting dumped on January 19.
Amazon blamed the move on Visa’s high processing fees, but conspiracy theorists suspect something bigger is afoot.
Were Jeff Bezos and his Sun Valley buddies plotting a financial revolution? Did Amazon need to save some dough to colonize the cosmos?
I put on my tinfoil hat, rewatched JFK, and called up my pals in QAnon to find out what was up.
1. Amazon plans to crush payment providers
Payment processing firms are deeply integrated into our financial system, but their position could become less secure.
“Many merchants are looking for alternative ways to process customers’ payments, especially in light of the high fees charged by some providers, like Visa and Mastercard,” said James Hickman, the chief commercial officer at Ecospend, a UK fintech. “The decision is significant, however, in that it sets a precedent for many others to follow suit.”
Developments in Open Banking could allow Amazon to bypass card firms and take payments directly from customers. That could save Bezos some cash to splash on ego trips to space.
2. This is all because of Brexit
Visa’s charges have risen since the UK left the European Union. The EU had capped cross-border interchange fees at 0.3% for credit cards, but those rules have disappeared since Brexit.
In March, the Financial Times repoted that Visa planned to increase its interchange fees to 1.5%.
Martin Lewis, a financial journalist and founder of MoneySavingExpert.com, said Visa’s price-hike triggered Amazon’s ban…Read more>>