Amazon will stop accepting Visa credit cards issued in the UK from 19 January, the online retail giant has said.
It said the move was due to high credit card transaction fees but said Visa debit cards would still be accepted.
Visa said it was “very disappointed that Amazon is threatening to restrict consumer choice in the future”.
Amazon said: “The cost of accepting card payments continues to be an obstacle for businesses striving to provide the best prices for customers.”
The online retailer said costs should be going down over time due to advances in technology, “but instead they continue to stay high or even rise”.
An Amazon spokesperson said the dispute was to do with “pretty egregious” price rises from Visa over a number of years with no additional value to its service.
Amazon is offering £20 for Prime customers to switch from using Visa to an alternative payment method, and £10 for other customers, if they have a Visa cards as their default or only payment method on their account.
Visa said in a statement it was “very disappointed that Amazon is threatening to restrict consumer choice in the future. When consumer choice is limited, nobody wins.”
It said it had “a long-standing relationship with Amazon” and that it was trying to resolve the situation so customers would be able to use Visa credit cards with Amazon UK.
Amazon declined to say how much Visa charges the retailer to process transactions made on credit cards.
Visa also declined to comment though it claimed that on average it takes less than 0.1% of the value of a purchase.
Amazon and Visa said any changes in fees had nothing to do with Brexit.
Both Visa and its rival Mastercard have raised the so-called interchange fee on cross-border transactions between businesses in the UK and the European Union following Brexit.
The dispute between Amazon and Visa is to do with the fees the credit card company charges Amazon for its services in the UK.
Amazon is also considering dropping Visa as a partner for its US co-branded credit card.
It is in talks with payment networks, including Mastercard, American Express and Visa – as part of what it calls a standard process, the BBC has learnt.
By Tom Espiner
Business reporter, BBC News