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Visa (V) shares slump 2.5% as AMZN credit card dispute continues

By William Hoffman

15:59, 22 November 2021

Two Amazon cards
Amazon and Visa partner on co-branded credit card - Photo: Amazon

Visa shares fell by as much as 6% last week and are trading 2.5% lower again on Monday as online retailer Amazon takes issue with the company’s UK fee structures that are threatening a long-standing credit card partnership between the two companies.

Amazon announced last week that it will no longer accept UK-issued Visa credit cards on starting on 19 January 2022. The change comes after Visa increased its interchange fee on transactions between the UK and European Union to 1.5% up from 0.3%.

The fees are capped lower in EU law but amid Brexit disputes Visa and other payment processors such as Mastercard are increasing interchange fees in the UK.

“The cost of accepting card payments continues to be an obstacle for businesses striving to provide the best prices for customers,” a statement from Amazon read. “These costs should be going down over time with technological advancements, but instead they continue to stay high or even rise.”

Visa seeks resolution

Visa chief financial officer Vasant Prabhu said in an interview on Friday that the company expects to resolve these issues so that Amazon customers in the UK are not impacted.

However, those reassurances provided little support to the share price, which fell by 1.15% on Friday and opened Monday down another 2.5% before noon, even as the broader market rallied.

Visa shares have now fallen more than 19 points since the announcement for a 9% loss. Year to date, shares are down by more than 10%.


6.49 Price
-1.530% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 0.04


15.56 Price
-4.230% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 0.16


475.08 Price
+2.100% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 0.14


147.43 Price
+8.350% 1D Chg, %
Long position overnight fee -0.0262%
Short position overnight fee 0.0040%
Overnight fee time 22:00 (UTC)
Spread 0.54

“We are very disappointed that Amazon is threatening to restrict consumer choice in the future,” a spokesperson for Visa said in a statement obtained by

“When consumer choice is limited, nobody wins. We have a long-standing relationship with Amazon, and we continue to work toward a resolution, so our cardholders can use their preferred Visa credit cards at Amazon UK without Amazon-imposed restrictions come January 2022.”

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Credit card program at risk

Beyond the fees issue, Amazon is reconsidering whether to renew its partnership with Visa for the online retailer’s co-branded credit card, which provides consumers additional cashback for purchases made on or its Wholefoods grocery stores.

Amazon is said to be in talks with Mastercard and American Express in addition to Visa for the credit card program. While the high fees are deteriorating the partnership between Amazon and Visa, other card payments processors have also raised fees.

Average credit card processing fees range between 1.5% and 3.5% of each transaction, according to reports.

The whole dispute has market analysts wondering if Amazon will look to circumvent the traditional credit card payments processors entirely in favor of its own payments app – Amazon Pay – or other third-party options.

Read more: Visa (V) ban “odd move” from Amazon (AMZN), says expert

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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