Amazon Introduces Small Business Credit Card Processing Service
Amazon has recently introduced the Amazon Local Register, a credit card processing device and mobile app designed to help small business owners with payment transactions through their smartphones and tablets.
This places Amazon in competition with Square and other mobile payment processing systems including PayPal Here and GoPayment.
Amazon's new technology features a credit card reader that attaches to a smartphone, tablet or Kindle. The reader processes debit or credit payments via a secure Amazon network--the same that processes Amazon.com purchases. The service is aimed to serve small businesses who might otherwise be limited to accept cash or check only, including food truck operators and vendors who sell their products at outdoor locations.
Small businesses can start using the service--called Local Register--by creating an account on http://localregister.amazon.com. Businesses must purchase the card reader for $10 and download the free mobile app from the Amazon app store, the Apple app store or Google Play.
Much like Amazon's strategy in many of its businesses, the company intends to compete on price in the mobile payment arena. For those who sign up by October 31st, Amazon will take $1.75 percent of each payment processed as its fee. This special rate will only last until January 1st, 2016. For those who sign up for the service after October 31st, Amazon will take a service fee of 2.5 percent of each payment processed.
The first $10 in transaction fees will be credited back to the user, which essentially pays for the reader.
These prices are below most of Amazon's competitors' rates. Square reportedly takes a fee of 2.75 percent of each transaction. Paypal Here takes 2.7 percent and GoPayment rates start at 1.75 percent per transaction in addition to a $19.95 monthly rate; otherwise, GoPayment takes 2.4 percent of each transaction.
Amazon has expanded into the payment realm with additional products such as Amazon payments, which allows users with stored card or banking information on Amazon.com to use their Amazon login to pay at outside sites. Amazon has also introduced Amazon Wallet, a beta app that lets users store gift cards, loyalty/rewards cards and membership cards and redeem them either in store or online.