Saturday, July 13, 2024

Amazon and Visa Strike last-minute deal

Amazon has been the dominant online retailer for at least the past decade.  It was not always plain sailing for the internet behemoth. Back when the dot com bubble first boomed and, then most of the companies went bust, Amazon was also struggling to create a workable model. Year after year massive losses were posted and there was huge scepticism about whether large scale e-commerce could ever be feasible. Back in the 1990s, it seemed hard to imagine that we would abandon our high streets in return for badly displayed products on a flickering computer screen.

How far we have come when we hear that Amazon UK was threatening to suspend the use of Visa credit cards. While a last-minute deal has been struck to ensure that the cards are still accepted, this is a story that shows how the power has shifted.

Amazon has gone from being an online shopfront, then to a full-service retailer and is now a big tech company. It provides a full suite of services from shop front to fulfilment, warehousing, and delivery. In the US it is starting to take the P2P payment platform, Venmo. It offers its third-party sellers access to its backend services. It has expanded its offering to customers from an online bookstore to a one-stop-shop for everything. The business inventory includes video streaming, audiobooks and podcasts, cloud computing, AI, and Machine Learning technologies.

When Amazon was in its infancy the commercial giants were the supermarkets, the banks, and the finance sector. These were industries that set the rules and rates that everyone else had to play by. It was up to the payment processing platforms like Visa to develop systems that allowed people to feel secure when using their payment cards online. Verified by Visa gave confidence to people to use their bank cards on the internet and this is when e-commerce took off.

From sites like Apple Music being able to offer download and streaming services to paying for your passport application on the Government payment portal, Visa is accepted as a trusted payment platform. With the protections that Visa offers its customers, many people have chosen it as a preferred payment method when they are gaming and gambling online. A bank-issued Visa card can be used for upfront purchase of a game, for in-app purchases, and for placing deposits for online slots and casinos. 888 casino review shows a huge selection of games and a 100% deposit bonus. You can use your Visa card to open your account.

Online security has come a long way from the early days and using an e-wallet like ApplePay or PayPal adds an extra layer of security with two-stage authentication required to access your payment device.

For the past few months, a power war has been bubbling away between Amazon and Visa. It was claimed that Amazon was trying to get Visa to reduce its credit card charges. Since an announcement in November, there has been a game of brinkmanship going on between the two organisations. The battle went right down to the wire with an 11th-hour settlement. On Monday 17th January, Amazon started sending emails to their affected customers saying that they did not need to update their card payment details.

Changing cards could have led to Amazon losing Prime customers who may have chosen to switch to an alternative streaming service for their music or films. It was claimed that Amazon could lose up to £1.4billion from UK shoppers had people not been able to use their credit cards on the site.  For Visa, the stakes were arguably even higher. They saw their share price slump by 5.2% when the original announcement was made, and they were set to lose their share of the massive Amazon shopping basket which has continued to see an upward trajectory.

The resolution between the companies has been labelled as interim, so expect to hear more comings and goings before a final deal is struck.

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