Amazon will stop accepting Visa and Mastercard in Britain

Image copyright Getty Images Image caption Amazon has said that Visa and Mastercard are too difficult to work with

Online retailer Amazon has said it will stop accepting Visa and Mastercard payments in Britain after the two card companies resisted its demands for changes to how they process its payment transactions.

Amazon has become one of the biggest sellers on Britain’s high streets but is cutting back its online presence.

The British arm of the website has around 270,000 users across Britain but said it was focusing on its physical stores in the face of tougher competition.

So far, there is no information on the company’s other payment providers in Britain.

Visa and Mastercard have agreed that Amazon will still be able to accept its card payments in other countries, including the US, but the company will not be able to accept them in Britain.

It will also be able to continue accepting American Express and Discover cards.

“We are disappointed that Visa and Mastercard are unwilling to work with us to improve both their system and the customer experience,” the company said in a statement.

“As we have already seen, the UK market is becoming increasingly competitive in the online retailing environment.

“Our stores have been an integral part of our mission to be the destination for customers to discover and buy anything.”

Amazon has issued its website users with prompts to contact the company on the phone for help in making alternative arrangements.

“We apologise that customers could be inconvenienced as a result of these changes and we will work quickly to return the functionality of our payment services so they can continue to shop with Amazon,” the company said.

Amazon’s business model of selling individual items, rather than selling complete product lines, has seen it cut back on its online presence in some countries – particularly in France.

In the UK, the company said it was focusing on “our dedicated brick and mortar stores”.

Nigel Rumfitt, equity analyst at Haitong International Securities in Hong Kong, said Visa and Mastercard had been “quite difficult” in working with Amazon over issues such as how Visa and Mastercard were dealt with when they tried to change their software.

“I think this reflects a more global view where companies are increasingly favouring local payment systems in line with local preferences,” he said.

Visa and Mastercard did not immediately comment.

Visa was hit last month by a $2.25bn (£1.6bn) fine imposed by the US Federal Reserve.

The British financial regulator is currently working with the Federal Reserve and the agency for the state of New York to look at how the amount should be calculated.

“We hope that the framework set by the Commodity Futures Trading Commission in the United States, which would not involve the use of ‘market swings’ to determine the level of fines will be reflected in this process,” the Financial Conduct Authority said in January.

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