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Websites Can Let Customers Checkout Through Amazon

Amazon is reemerging as a third-party payment provider leveraging the hundreds of millions of Amazon buyers that already trust their payment credentials with the online titan by providing the option to “Login and Pay with Amazon” on other merchant’s eCommerce sites.

Amazon is experienced in the payments space as they have enjoyed the largest eCommerce sales volume in the United States while ranked number one on Internet Retailer’s Top 100 list for many consecutive years. They are also familiar with acting as third-party payment processor or payment aggregator as they have offered services like Checkout by Amazon and Flexible Payment Services. In early October the company announced their “Login and Pay with Amazon” service which will enable merchants to offer a payment option in which consumers confirm their billing and shipping information by logging into their Amazon account. Amazon processes the payments and charges merchants with a rate and model that very closely resembles PayPal and other e-wallets.

While most online merchants accept credit card payments directly, consumers have started to become more conscious about who and how many parties they share their credit card information with. Leveraging their existing 215 million active consumer accounts, Amazon offers merchants the ability to accept payments from these consumers who have already provided the needed billing and shipping information, and while offering a quicker, easier checkout process versus providing all the needed payment and shipment information directly.

The value of not requiring consumers to provide payment information directly to a merchant should not be discounted, especially as it relates to small and medium businesses. In their latest True Cost of Fraud Study LexisNexis found that 50 percent of fraud victims will avoid patronizing smaller online merchants as a result of being the victim of fraud, and this is regardless of whether that particular merchant was actually responsible for the fraud or data compromise. Comparatively only 19 percent of fraud victims would avoid large online merchants. These figures suggest that merchants should be offering payment options that don’t require the consumer to share their payment credentials directly, especially smaller online merchants.

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