Amazon could lose nearly £1.4 billion from UK shoppers when it blocks Visa credit card payments next year

AMAZON faces losing nearly £1.4 billion from UK shoppers when it blocks payments made using Visa credit cards in Britain from January 2022

A study of 2,000 adults found that 13% of Amazon’s 48 million UK customers – equivalent to 6.15 million people – intend to either slash the amount of their purchases or totally quit buying from the corporation.

AFP
Amazon could lose as much as £1.4 billion when it stops letting shoppers use the payment method[/caption]

As Amazon’s total UK revenues in 2020 were £20.63 billion, the loss of this part of its British customer revenues could cause the firm to lose £1.356 billion in purchases.

Data suggests Visa credit card transactions last year accounted for around £1.4 billion of the firm’s net sales in the UK.

It also emerged a third of those polled have been left with “negative” feelings against the firm for stopping Visa payments from 19 January 2022.

More than a fifth of UK consumers added they predict Amazon’s UK transactions to nosedive by up to 50% in the wake of the change.

A spokesperson for researchers OnePoll, said: “The inconvenience factor of this has clearly got Brits riled.

“They obviously don’t like being told what to do or given the extra admin of changing payment details due to a petty battle between two of the world’s biggest corporations.

“Those dissatisfied, disappointed and angry at the move may also be aware other factors may be at play.

“There are plenty of industry insiders who believe Amazon’s dramatic decision is calculated to drive customers to adopt the company’s own credit cards, which will give a competitive advantage to Visa’s main rival Mastercard.”

The study found nearly 90% of those polled shop on Amazon, with 27% of those preferring to pay via Visa credit card.

Another 34% used a Mastercard credit card, while 27% had a debit account lodged with the site.

Almost a fifth buy goods online “a couple of times a week”, with 14% of respondents shopping on Amazon “most days”.

Another 65% said they also paid for an Amazon Prime account that allows for speedier shipping of items.

More than four in 10 were “frustrated” by the prospect of not being able to use Visa credit cards on Amazon and only 11% felt more positive towards Amazon due to the upcoming ban.

A third will register a different card and continue shopping with Amazon once the block on Visa credit cards begins.

Despite frustration about the change, 49% felt Amazon was in the right to “stand up to” Visa for increasing fees, while 20% said the corporation was wrong.

Amazon’s announcement on the payment ban came on November 17, citing “the high fees Visa charges for processing credit card transactions” as the reason for its decision.

It came after it was reported in March that Visa was planning to hike fees for items bought in Britain from Europe.

The Brexit-linked interchange fee increase for online credit card payments jumped to 1.5% – up five times from the previous 0.3% rate.

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