Is Amazon Getting Into Payment Processing?

amazon payment

Amazon’s $13.4 billion acquisition of Whole Foods has been dominating the news – just like news of how well Prime Day went this year. Although these would be enough to keep most companies busy, Amazon is far from “most companies.” They launch a ton of new initiatives and aren’t afraid to scrap the ones that fall flat, while doubling down on the ones that show promise.

The Recent Appearance of Amazon Pay Places

When you think of extremely popular mobile apps, Facebook and a few other chat apps come to mind. Another app that tops the list? Amazon. In fact, in some age cohorts, its installed base even bypasses that of Facebook.

That’s why it’s no surprise that Amazon is getting into the payment processing industry, according to recent reports. There’s huge profit-making potential in payment processing, and Amazon has already crossed many of the common barriers associated with entering the space.

In the middle of July, some users reported the addition of a new feature to the Amazon app called Amazon Pay Places. Although the app’s functionality is currently limited to a handful of T.G.I. Fridays restaurants, it’s easy to see how this technology has the potential to be very disruptive.

More Information About Amazon Pay Places

The current version of Amazon Pay Places makes it possible to place a restaurant order in advance. Even though that may not seem very cutting-edge, what makes Amazon Pay so interesting is its scale. Current estimates state that if all merchants could accept Amazon Pay, only accepting this single form of payment would allow a business to still service 90 percent of their current and potential customers.

While speculation about where Amazon will take this technology is just starting, there have already been some interesting thoughts. For example, given Amazon’s commitment to other people’s margin being their opportunity, creative incentives could be utilized by Amazon to speed up adoption and usage of this technology. On the merchant side, Amazon could use all the data they have to make very targeted recommendations to put businesses that accept this form of payment in front of new customers.

In most cases, this type of competition has a positive impact on businesses. But as we’ve seen with examples like Apple Pay, getting consumers fully on board with new payment technology takes time. So as long as you have a great payment processing company that makes it easy to accept a wide range of payment types, you’ll be in a good position to accept Amazon Pay if it starts to take off.

 

 

Posted on Monday, August 21st, 2017