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I cannot believe that Visa transaction overhead would be higher than Amex - there's something going on behind the scenes here. I don't think this is the end of
by barrkel 5y ago
I cannot believe that Visa transaction overhead would be higher than Amex - there's something going on behind the scenes here.
I don't think this is the end of it either, it smells like a negotiation threat. Visa have a larger market share overall (80%, including debit cards [1]) but Mastercard leads in credit cards. Amex has always been fairly niche because it's not accepted everywhere.
[1] https://www.statista.com/statistics/1116580/payment-card-scheme-market-share-in-europe-by-country/ https://www.statista.com/statistics/1116580/payment-card-sch...
> Visa was the largest card issuer in Ireland and the United Kingdom, with market shares of over 80 percent in both countries. (from 2019)
Reading further it does look like most Visa cards are debit cards and Mastercard has the lead in credit cards.
PS: Comment updated after some research.
- mutatio 5y agoFor my personal data point, 1 of 7 cards is Visa, the rest are Mastercard.
- rbanffy 5y ago> I cannot believe that Visa transaction overhead would be higher than Amex - there's something going on behind the scenes here. I would be willing to bet the fees Amazon gets are vastly different from the fees a small merchant has to endure. They obviously tried to squeeze a little bit more and now they’ll leave it to the shareholders to pressure the company to accept whatever Bezos wants.
- uzakov 5y agoI think situation in 2021 is very different in London: AMEX is accepted nearly everywhere in central London (Even on markets etc), there are ofc some shops that don't take it but generally AMEX is widely accepted. Re: Mastercard It seems that Mastercard is more widespread among "hot" banking startups, ie I can create virtual debit Mastercards on Revolut and Monzo
- blowski 5y agoI'd like to see some stats on that. My own experience is much closer to that of the OP.
- em10fan 5y agoOther than some occasional small restaurants/pubs, and a few small indie shops, its basically accepted everywhere here in Edinburgh, I have a corporate amex and use it for expensing business dinners very often, and supplies from office shops, supermarkets, etc..
- blowski 5y agoI used to have a corporate Amex, and it was a nightmare to use it in London. Even in places that said they accepted it, when I attempted to pay the card reader rejected it. That was about 5 years ago, maybe times have changed - it would be great to see data rather than a mixture of anecdotes.
- david_allison 5y agoWas your card Chip & PIN? Didn't have a problem with my British-issued Amex in London 5 years ago.
- Macha 5y agoYeah, my success rate for the corporate Amex in Europe is 70-80% which means the remaining time I need to fill out more tedious paperwork to get reimbursed to my personal card. The US based finance team continue to insist its much better now, but a 20-30% failure rate is too high
- pishpash 5y agoAmex has gone the lower-fee route on some cards in recent years. Visa, with Visa Signature, may be going the other way.
- uzakov 5y ago
- hocuspocus 5y ago> It seems that Mastercard is more widespread among "hot" banking startups, ie I can create virtual debit Mastercards on Revolut and Monzo They were definitely first in this space but Revolut has issued Visa's (in some cases) for a while now, and for instance Wise has recently switched from MasterCard to Visa entirely.
- wdb 5y agoReally never had a Visa credit card only master card in the UK. Visa debit cards, yes.
- em10fan 5y agoTotally agree. All the major banks apart from Barclays and HSBC use Mastercard for credit
- flumpcakes 5y agoNationwide uses Visa for their credit cards.
- wdb 5y agoAh the banks that didn't let me open a bank account when I moved to the UK :)
- flumpcakes 5y agoTechnically they are not a bank. They are a building society, but they are effectively a "bank" and have a few million customers.
- rjsw 5y agoMy HSBC credit card has always been Mastercard.
- fanf2 5y agoI was looking at HSBC’s credit card services earlier; they have a mixture of VISA and Mastercard, though they tend to use Mastercard for the more high-end services.
- pornel 5y agoFirst direct (HSBC) has recently switched from Visa to Mastercard. The switch felt sudden, and I wouldn’t be surprised if it was due to negotiation that fell through.
- PaulKeeble 5y agoBut so far only on it debit cards, it still offers visa credit cards.
- dazc 5y agoI have John Lewis credit card , which is essentially branded HSBC, and it is Mastercard.
- Crosseye_Jack 5y agoNatwest are also swapping to MasterCard debit once cards expire. I just presumed the issuing bank had negotiated a more favourable interchange rates than using Visa. (MC taking less of a cut of the final fees then Visa, so the banks getting a higher precentage of the fees then they would have sticking with Visa. Lets say MC gave away 5% of their cut to the banks, keeping 95% of the your slice of the pie when you are processing more pies is more than 100% of your slice of fewer pies if you get what I mean).
- em10fan 5y agoQuite the opposite in the UK, at least over the last 10 years or so. 99% of debit cards are Visa, and most people buying stuff on Amazon would be using a debit card, folks only really use credit cards for large purchases and things like travel, here. Even when it comes to credit cards, I would say Mastercard has like a large chunk - like 80% in terms of institutions (but who knows in terms of actual customers), I would say. Barclays and HSBC are the only majors that do Visa as far as I know. And Vanquis which is a junky one for people with bad credit. The other majors like Lloyds, TSB, Bank Of Scotland, Halifax, Natwest, RBS, are all Mastercard. Same with most smaller banks like Virgin and CapitalOne, and store branded ones like Sainsburys/M&S/Tesco, too, as well as the remainder of the popular bad-credit cards like Ocean, and Aqua. Mastercard.
- chrisseaton 5y ago> folks only really use credit cards for large purchases and things like travel, here This is delusional - the British have as many credit cards as people, £56.5 billion on credit cards, and 40% of credit card transactions were contactless, so certainly not large purchases.
- barrkel 5y agoYou're right, my perception was influenced by how many of my cards are debit cards or debit-like (i.e. prepay of some kind). When those switched issuer over the years, it was always Mastercard -> Visa.
- te_chris 5y agoWe put all our purchases on credit cards here in the UK (London) - but pay them off monthly. Amex Gold and Barclays Platinum Visa (it has 0 overseas fees, but a bit of a stingy limit. mostly just used where Amex isn't accpeted). Amazon lets you spend Amex points, so guessing the tie up runs deep. Best not to read into fights between gods.
- kinnth 5y ago100% I pay for almost everything on AMEX to get the points and use Monzo debit for the rest. Amazon has my amex linked and I use it for 100% of purchases. Most people in the uk chase points and credit cards have much better points and bonus' than debits.
- ralferoo 5y agoThere might be something going on with Visa in the UK. I've noticed that all the bank accounts I've had that used Visa for debit cards for many years all seem to have switched to Mastercard recently. Presumably they wouldn't overcome this much inertia unless there was a substantial financial incentive. If card issuers are finding that their costs are too high, chances are payment processors are as well.
- tupac_speedrap 5y agoSame here, thought I thought was being scammed but everyone else in my family got letters saying that their cards are moving to Mastercard debit in the coming months. I doubt Visa will have much marketshare even in the debit card market by the end of next year.
- IanCal 5y agoI think visa are increasing their fees from 0.3% (EU regs) to 1.5% here.
- nicoburns 5y agoHuh, so the UK hasn't kept that law when leaving the EU? That's an odd decision!
- joshuaissac 5y agoThey have, but it only applies in the same jurisdiction. So it still applies to intra-UK transactions and to intra-EU transactions. But not to transactions between the two.
- softveda 5y agoAmazon Australia has started charging 0.5% for Visa cards. In Australia a merchant can charge more for payment by credit card but only up to the actual extra cost they incur.
- mcbain 5y ago0.5% on Visa credit. Visa debit has no charge.
- ericyan 5y agoThis practise is illegal in the UK and that's probably why they decided to this instead
- gambiting 5y agoIt's illegal everywhere in the EU as well. If a merchant accepts debit/credit cards then they are not allowed to charge extra for using them.
- ericyan 5y agoYeah, the catch is "if a merchant accepts..." I live in the Netherlands and biggest supermarket chain here, Albert Heijn, is strictly Mastro-only. This is not a problem for the locals, but you will find angry reviews left by tourists on pretty much every ah branch in Amsterdam on Google Maps.
- gambiting 5y agoSure, and in theory that should be the prime example of "free market" at work - merchant doesn't want to accept visa/mastercard? They will lose customers then, if that's acceptable to them then that's their choice.
- caf 5y agoSame if they pass on the card costs to the customers though - card user doesn't want to pay the true cost of using their card, they can choose to shop elsewhere.
- lmilcin 5y ago> Visa have a larger market share overall (80%, including debit cards [1]) but Mastercard leads in credit cards. I worked in credit card payments (on acquiring side). Any market share advantage between Visa and Mastercard is very, very fragile. It is basically your choice which card to pull out for payment. It is also why Visa and Mastercard these are so alike almost in every aspect. When one does something, the other copies it. The only reason this is still split between two companies is exactly because of this parity between products. People have no reason to prefer one over other and simply toss a coin to make their choice. When I had chance to configure my phone to do NFC payments, my bank supported it only for Mastercard, so I configured Mastercard and that's how it is now. I know a lot of people got Mastercard because here (in Poland) it was tiny bit faster than Visa. If Amazon bans UK Visa, people will not stop using Amazon. They will either pull out the other card or grumble for couple of days and get Mastercard. It is likely Visa has NO negotiation power here. They are the ones that have commoditized themselves and are easily replaceable for their competitor. It is likely Amazon is well aware of this and this is just a show of strength that will be followed by Visa submitting to it because they have no choice.
- pishpash 5y agoI've understood Visa and Mastercard to share some kind of relationship but cannot find the source any more.
- lmilcin 5y agoYes, they are actually working together a lot. There is PCI (Payment Card Industry) and then there is EMV. There is probably more but the two have been important from my point of view. The main motivation for this is to make payment technology transparent to the user (as in use any card anywhere, expect similar behavior, etc.) A lot of this is standardized so much that it is virtually the same for both. And I know this, because it was my job to implement these standards. I calculated some 17 thousand pages of specifications in various forms. Both Visa and Mastercard gain a lot form this because it is not a zero-sum game. Because of this cooperation people have been steadily increasing their use of credit card payments and this I think created a lot more revenue than they could have ever created for themselves by winning a cutthroat competition.
- deleted 5y ago[deleted]
- tyingq 5y ago>I cannot believe that Visa transaction overhead would be higher than Amex Merchants put up with high Amex transaction fees because Amex cardholders tend to be affluent and frequent purchasers.
- Reason077 5y ago> "I cannot believe that Visa transaction overhead would be higher than Amex - there's something going on behind the scenes here." Especially considering that card transaction fees (in the EU and UK) are capped by the Interchange Fee Regulation (IFR) [1] But I suppose Amazon processes card payments in such huge volumes that they expect to get rates below the cap limits (0.2% for debit cards and 0.3% for credit cards), or Visa are applying excessive additional fees outside of the interchange fee? [1] https://www.psr.org.uk/our-work/card-payments/the-ifr/ https://www.psr.org.uk/our-work/card-payments/the-ifr/
- orra 5y agoThe UK has hinted it wants to increase the cap, as a “Brexit dividend”.
- PeterisP 5y agoWhy would a larger cap benefit the UK or its government in any way? It's not like the "dividend" would be received by them, it's an effective +1% tax on all payments from consumers to the banks.
- ookware 5y agoBecause our government would appear to work more for the banks than the public
- zh3 5y agoFWIW, as a UK Amazon buyer with a Visa Credit card, I received an email this morning with Subject line "Visa credit cards will not be accepted, starting 19 Jan, 2022" and nothing but my name in the body. A very, very basic email - interesting 'From' address though. Received: from a0-156.smtp-out.eu-west-1.amazonses.com (a0-156.smtp-out.eu-west-1.amazonses.com [54.240.0.156]) <redacted> From: "Amazon.co.uk" <amazon-offers@amazon.co.uk> Subject: Visa credit cards will not be accepted, starting 19 Jan, 2022 Date: Wed, 17 Nov 2021 09:15:34 +0000 Content-Type: text/plain; charset=utf-8 Amazon.co.uk <name redacted> Please note that this e-mail is being sent from an e-mail address that cannot receive e-mails. If you have any questions and wish to contact us, click here: https://www.amazon.co.uk/gp/help/customer/display.html?<redacted> 2021 Amazon.co.uk is a trading name for Amazon EU Sarl, for Amazon Media EU and for Amazon Services Europe Sarl, all of which have their registered office at 38 avenue John F. Kennedy, L-1855 Luxembourg.
- r_c_a_d 5y agoYes, I got one too and thought it was spam.
- GoodbyeMrChips 5y agoJoin the club. The email formatting was so shite, I'm pretty sure any savvy reader assumed it was pishing (even though the URL appears legit).
- whylo 5y agoI've just checked my copy of the email and you're right, the text/plain part only has my name in. The text/html part has the full message though.
- zh3 5y agoThat's interesting, mine definitely only has plain text (no text/html, checked via view source etc). Maybe it's a preference I ticked somewhere back in the mists of time.
- ireadfaces 5y agoAmex has fairly been consistent 'because it is not accepted anywhere'