Amazon Payment Services Takes on Paypal and Google Checkout


Paypal and relative newcomer Google Checkout will both face off against a new contender in the online payment arena as Amazon jumps into the ring with a service of its own. Called Checkout by Amazon, the new service gives online retailers the option of letting Amazon manage their payments, along with some compelling reason for letting them do so.

Surfers who already have an account registered with Amazon (and who doesn't?) will be able to pay for goods at sites using Checkout by Amazon using billing and shipping details already on file with the mega e-tailer. Sites using the service can also offer customers the same '1-Click ordering' as Amazon, order tracking and management, promotions, Amazon's purchase protection policy , and other nuances associated with shopping directly at Amazon.

"Customers will be coming through an experience that is really similar to Amazon's," said Mark Stabingas, VP of Amazon Payments. "People will like the familiarity and comfort associated with that."

Should Paypal be Worried?

While it's far to early to gauge what impact Google Checkout will have in the world of online payments, there's no disputing that Paypal currently runs the show. Ebay's acquisition of the online payment service for $1.5 billion allowed for a tighter integration into the massive online auction site, and Paypal has since branched out as a payment method found at just about any online retailer. With that kind of market penetration already in place, it becomes hard to imagine another service toppling Paypal's empire.

On the other hand, it would be a mistake for Paypal to become complacent in its position. serves as proof that the online economy is ready for a competitor to step up, and it seems as though everyone has at least one horror story to share, whether it be about having their account frozen or dealing with unsympathetic customer service after being scammed.

Pricing and Fees

Like Paypal, Checkout by Amazon will asses fees on a per-transaction basis based on both a percentage of the sale and a per transaction fee. But unlike Paypal , volume sellers will receive a discount based on the amount of sales.

  • 2.9& + $0.30 for all transactions over $10
  • 5.0% + $0.05 for all transactions under $10
  • 2.5% + $0.30 for all transactions for monthly payment volume from $3K-$10K
  • 2.2% + $0.30 for all transactions for monthly payment volume from $10K-$100K
  • 1.9% + $0.30 for all transactions for monthly payment volume over $100K

Amazon Simple Pay

In addition to Checkout by Amazon, the site also introduced a lighter version called Amazon Simple Pay . The two payment services share the same fees structure above, but the latter does away with additional capabilities like real-time shipping and tax calculation, order management, and a host of other features.

"If you don't need Amazon's end-to-end checkout pipeline and order management capabilities, but still want to enable your customers to use their payment information already on file at, use Amazon Simple Pay," the site reads.

Should Paypal be worried?

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