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Amazon Launches Payment System – Amazon Flexible Payments Service

Amazon.com recently announced that they are entering the merchant services arena by offering their own in house payment system. Called Amazon Flexible Payments Service, or Amazon FPS for short, it is designed to be a direct competitor of Paypal and Google Checkout. An advantage it potentially offers over Google Checkout is through Amazon.com’s huge database of customers it already has billing information on file for a large portion of their potential user base. This can mean a quick and easy checkout. Unfortunately, like Google Checkout, your customer will need to go to the Amazon.com website to make payment.

Some of the features they offer include:

  • Accept payments three different ways:
    • Credit Card
    • ACH
    • Amazon Payments balance transfer
  • Accept one time, multiple, and recurring payments

The fee structure is very similar to Paypal and is listed below:

  • For Transactions >= $10:
    • 1.5% + 1¢ for Amazon Payments balance transfers
    • 2.0% + 5¢ for bank account debits
    • 2.9% + 30¢ for credit card
  • For Transactions < $10:
    • 1.5% + 1¢ for Amazon Payments balance transfers
    • 2.0% + 5¢ for bank account debits
    • 5.0% + 5¢ for credit card
  • For Amazon Payments balance transfers < $0.05:
    • 20% of the transaction amount, with a minimum fee of $0.0025
  • Qualified developers can apply for the following monthly volume discounts for credit card transactions:
    • 2.5% + 30¢ per transaction for monthly payment volume from $3,000- $10,000
    • 2.2% + 30¢ per transaction for monthly payment volume from $10,000 – $100,000
    • 1.9% + 30¢ per transaction for monthly payment volume over $100,000

On the surface this new service does not appear to differentiate itself from Google Checkout or Paypal in any meaningful way. It will be interesting to see its uptake by merchants and consumers.

You can read more about Amazon Flexible Payments Service on their website here.

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