Digitec Galaxus and Twint go their separate ways (for now)

The dispute has escalated: Twint will no longer be offered as a payment option in the online shops of Digitec and Galaxus with immediate effect.

breakup-twint

"The move has been months in the making: Twint wanted to impose a payment fee on us that was a multiple of the previous price," Digitec Galaxus writes in an Blog post. "We refused to accept the offer. Ultimately, we would have had to pass on the additional costs to our customers - through generally higher prices or through an inappropriate fee for Twint payments."

With this, the Swiss market leader in online retail is saying goodbye to the third most popular payment method after credit card and invoice. Digitec Galaxus was one of the first shops to offer this option in 2015. In the article, the company criticizes Twint for evolving from what was originally intended to be a simple and cheap alternative to an expensive payment option. "For example, it was originally intended that you could only deposit your bank account in the Twint app - but not expensive credit cards. It turned out differently." The 2016 merger with rival Paymit and the new co-owners - PostFinance, UBS, ZKB SIX and French payment service provider Worldline - meant that "unnecessarily, every bank wanted its own Twint app". "Among other things, the shareholders now want to recoup this extra effort by raising prices. But what can we or our customers do about the fact that Twint has burned through an estimated half a billion on a simplified bank transfer?"

 

"Untrue information"

Twint isn't taking the allegations lying down, and on Sunday it released a Rejoinder. Digitec Galaxus is spreading "untrue information", according to the payment provider. The fact is that Twint is one of the payment methods with the lowest transaction fees, cheaper than many payment methods that Digitec/Galaxus also offers. Moreover, Twint does not charge any "hidden costs". Digitec Galaxus' other claims are also "pure eyewash."" It is true that Twint was no longer prepared to guarantee Digitec Galaxus special conditions, as was customary when Twint was launched. All the other 7000 or so merchants in Switzerland pay fair transaction fees that are also favourable compared to credit cards and other payment providers."

 

No special conditions for the market leader

"The fact that Digitec/Galaxus, of all places, does not want to come to an agreement with Twint, Switzerland's largest mobile payment method, but apparently accepts the fees for all other payment methods, is something we consider unfair," says CEO Markus Kilb, who hopes that the many satisfied Twint customers will soon be able to pay with Twint again at Digitec Galaxus. "We remain open to talking with Digitec/Galaxus about fair remuneration for our services," says Kilb. However, he does not want to waive the required payment for the service: "It would be unfair to all retailers if we were to grant completely different conditions to a market participant." 

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