Amazon to compete directly with Paypal

online payment system for other sites offered

[amznVibe]

This is great news to me... while I really like PayPal and have mastered its powerful cart upload and subscription (renewing charges) features, I can't help but feel they have gone a little stagnant from lack of serious competition.

Amazon is about to offer just that...

"(Amazon) said it will launch the beta version of its payment system in a newsletter sent to partners regarding its Web services efforts. The system will "allow visitors to your site to use their Amazon account to pay you for any product or service"

[rss.com.com...]

[hakre]

nice pick. seems to be quite interesting. any statements made about a start of this and/or if it's worldwide or only country based (i.e. us only)?

[amznVibe]

Hard to find any more details for now. But I think sites will do well in also offering consumers Amazon as an alternative to PayPal. I think consumer trust in the Amazon.com name is fairly high, and think about just how many people already have an Amazon account.

I just hope both companies don't start getting "mean" and put in their contracts that you cannot offer both on your site (like PayPal did on ebay, where you could not list an alternate form of payment to get your bonus cashback)

[musicales]

amznVibe I agree this is most excellent news. They're one of the few names that people will trust and as you say, most people these days have an account with them.

[amznVibe]

It took a few days but I finally heard back from Amazon and they have added my company to the list for development beta testing on this service. Depending on any NDA I'll be happy to post some details on this if and when I get them.

I have to say at least one thing nice about Amazon - it may have taken over 48 hours to get a reply to my request, but at least it was a non-form letter written by a human. Try doing that with ebay or paypal with a complex inquiry.

[amznVibe]

Apparently it is taking them much longer to get going than their public announcement would have indicated. Good news however in that I finally received an a notice via email today that they are starting the developer beta. This should be rather interesting. My educated guess is that their system is going to immitate the old honor system api with extensions to process 3rd party goods.

It has occured to me that unlike PayPal, Amazon has something to sell, and I wonder if they are going to do more than just have a checkout system but run ads by our customers as well. Just a thought though, no proof of that yet.

[andy_boyd]

amznVibe, that's a good point there.

Imagaine Amazon offering a Paypal'esque service, cheaper, more flexible, more advanced cart, integrated with the Amazon back-end for affiliates and marketplace users alike, *but* they would use the checkout pages to advertise their own products.

That scenario would be a complete no-go area for anyone offering products similar to those found on Amazon.

On the other hand Amazon might just want to muscle in on the eBay / PayPal arrangement and try to establish itself in the online money transfer market. They could make plenty of profit out of the charges incurred to sellers and buyers alike. They also have a huge customer base and the most recognized name on the net.

This is just random speculation though. Another player can't be a bad thing though, it's another option after all.

[sun818]

Amazon can have a multi-tiered program for accounts that subscribe. Give Amazon permission to serve ads in return for a discounted processing fee for the seller. But it would have to be after the buyer finished buying from your site. Could imagine the abandonment rate if the ads were served before hand?

[amznVibe]

One of the other things I wonder about this is what the rates will be like. Their "honor system" charges right now are insane at 15%. They will have to compete strongly with paypal's 2.9% (and with PayPal you get 1.5% back via their debit card which is really slick since your rate comes down to under 2% if you use the card often). I also doubt they will handle checks like PayPal does.

[amznVibe]

Amazon annouced the beta today finally to the testers.

Apparently this was nothing to get excited about, it is simply an improvement of their current "honor system" payment method [s1.amazon.com] with an API extension.

Even with their "new" system the transaction amount can only be $1 to $50 and the transaction cost is 19 cents plus 5% of the transaction amount.

I think I'm sticking with PayPal for the smaller sites.

[killroy]

Now if google fuses the adSense income and adWords expenditure accounts... then opens up the system.. now THERE would be a contender with a trusted name.

After all they're already recievign adn making 100s of 1000s of payments per month, perhaps they are working on expanding that ;)

Don't shoot me, just speculating...

SN