Visa stock slipped on Wednesday afterAmazon announced it will stop accepting cards issued by the company in the UK.- The ban will take effect in January 2022. Amazon cited high transaction fees as its reason.
- "These costs should be going down over time with technological advancements, but instead they continue to stay high or even rise," Amazon said.
Visa stock slipped on Wednesday after Amazon announced it will stop accepting cards issued in the UK by the payment processor, citing its high transaction fees.
The online retail giant said the ban will take effect on January 19, 2022 and will only apply to Visa credit cards, not debit cards. Bloomberg was first to report the news.
"The cost of accepting card payments continues to be an obstacle for businesses striving to provide the best prices for customers," an Amazon spokesperson said in an email to Insider. "These costs should be going down over time with technological advancements, but instead they continue to stay high or even rise."
Visa stock tumbled 6.7% to $200.71, hitting the lowest level since February.
The company earlier this year hiked its merchant fees for certain credit card transactions, mostly online. This increase cut into revenue potential for merchants, especially since many are relying on e-commerce to stay afloat during the pandemic.
"We are very disappointed that Amazon is threatening to restrict consumer choice in the future," a Visa spokesperson said in an email to Insider. "When consumer choice is limited, nobody wins."
On Wednesday, Amazon made its announcement via email to its UK clients, acknowledging the disruption it will cause.
Non-Visa credit cards such as Mastercard, Amex, and Eurocard will continue to be accepted, according to the email.
Still, other payment stocks also fell Wednesday, with Mastercard dropping 4.4%, American Express off 0.6%, and Discover Financial Services down 1.3%.