Amazon drops Visa surcharge: What next?

Posted: 21 February 2022 8:59 am

No more 0.5% extra for customers in Australia.

The Amazon/Visa war is over.

Just 3 months after Amazon started charging an extra 0.5% to anyone in Australia who used a Visa card to make a purchase, the surcharge has been dropped.

"We've recently reached a global agreement with Visa that allows all customers to continue using their Visa credit cards in our stores," Amazon wrote in an email sent to customers. "As of 17 February 2022, Visa credit card purchases on will no longer incur a surcharge."

Amazon announced the surcharge, which began in November, with a major awareness campaign, including emails, app notifications and prominent messages on its site.

The withdrawal hasn't been quite so visible. Customers using a Visa card have been sent the email, but that's about it.

The reversal is good news though, since it leaves customers free to use their card of choice, and potentially earn frequent flyer points in the process.

But in practice, many customers will already have switched to using a different card, and they may not bother to switch back.

I'm a mildly tragic Amazon shopper with a serious Kindle habit, so as an exercise I looked up how much I'd have paid in surcharges from 1 November 2021 to 16 February 2022 on my purchases.

The total would be just under $6. Not heaps, but who wants to spend an extra $6 if you don't have to?

As I noted at the time of the announcement, companies are legally allowed to impose a surcharge on credit card payments, though this can't be more than the actual cost charged to them by the card network.

In reality, most businesses choose to suck up the cost, and even a giant like Amazon doesn't like to be an exception.

"We remain committed to offering customers a payment experience that is convenient and offers choice," Amazon wrote in its email.

I'm still expecting that a further incursion into the buy now pay later market will be the next big move from Amazon.

But for now, I'll enjoy having a (slightly) broader choice of ways to pay.

Want more out of Amazon? Check out the latest promo codes and sales and see what's new on Prime Video this month.

Angus Kidman's Findings column looks at new developments and research that help you save money, make wise decisions and enjoy your life more.

Picture: Getty Images

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