Dive Brief:
- Amazon introduced a new mobile payment system Wednesday, Amazon Local Register. The app-based system works with a $10 credit-card processing device that can attach to a smartphone or tablet.
- Orders are processed on a secure Amazon network after users create a Local Register account.
- For businesses that sign up with the system before Oct. 31, Amazon will take a swipe fee of 1.75% until Jan. 2016. Those who sign up after Oct. 31 will pay a 2.5% fee for each payment.
Dive Insight:
Amazon's fairly cost effective processing fee shows that it means business, coming in much lower than competitors: Square currently charges a 2.75% fee; PayPal Here a 2.7% fee. Cutting its fee by so much, and offering it for a relatively short amount of time, hints that Amazon is ready to go into the mobile payment market swinging, which, honestly, is no surprise.
Depending on its success, other mobile payment systems may feel the need to slash their processing fees to compete.
