Amazon Pay is an online payment processing service developed by e-commerce giant Amazon
Amazon is the biggest player in American retail. The platform is currently responsible for almost half of the U.S e-commerce market volume. In Q1 2020, Amazon Web Services alone brought the company $10B in revenues, while the total quarter earnings equal to $75.5B.
In December 2018, 206 million unique users visited Amazon’s websites every month. Moreover, in December 2019, there were an estimated 112 million Amazon Prime subscribers in the US. A great number of people trust the service with their payment details and they can use Amazon Pay on third-party websites without disclosing additional data.
What is Amazon Pay?
Amazon Pay is an online payment processing service developed by Amazon to give its consumers the option to pay with their Amazon accounts on external e-commerce websites and supported mobile apps.
The buyers have already stored their payment information with the Amazon shopping account and they don’t have to insert it for the second time as long as the merchant has Amazon Pay set up on their business page.
The company cooperates with a wide range of service providers ー commerce providers, payment service providers, agencies and professional developers including BigCommerce, Magento, Shopify, Zuora, WooCommerce, Hitachi Solutions and Chargebee ー to make its processing service available to millions of people.
The service is currently available for merchants with a place of establishment in the United States, United Kingdom, Austria, Belgium, Cyprus, Denmark, France, Germany, Hungary, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and Switzerland.
How does it work?
All kinds of businesses, including non-profits, can add the Amazon Pay button on the checkout or cart pages of their websites so that customers can sign in and access the payment instruments in their Amazon accounts. Non-profits can use this option to facilitate the donation process. Each business can personalize the customer’s shopping experience using the customer’s name and email. Those who use third-party e-commerce platforms (like Shopify and Magento) can integrate Amazon Pay from their interfaces.
Customers, in their turn, click the Amazon Pay button on business websites to access the payment instruments and addresses stored in their Amazon accounts and then pay for products in a few clicks. If a customer already has an Amazon account, they sign in and accept the customer agreement. However, even those who were not previously registered can access this payment option. If a buyer doesn’t have an Amazon account, they quickly create one in about 20 seconds.
Customers can also use Alexa to pay by voice. Alexa is a cloud-based voice service that allows users to add products to a wish list, re-order items, check order status, etc. simply by pronouncing these commands out loud. Alexa currently accepts credit cards and PayPal as valid payment methods.
How can businesses set up Amazon Pay?
To register for this payment option, business representatives should visit the website and click the “Register” button in the top right corner. They will be asked to fill in the registration form to provide personal and business information.
When you finish, you’ll have a new Amazon Payments Merchant account. The account information can be set up on the Seller Central website.
Another way to get an account is to visit this page and click “For merchants”. Choose the Sign Up option that is right for you — already using a cart or e-commerce provider, or not using a cart provider. Then you will be guided to create your new Merchant account.
In order to connect your store, log in to Seller Central and choose Integration Central from the Integration tab dropdown option.
Once you have completed testing and integration, follow the steps in the Amazon Pay and Login with the Amazon integration guide to switch from the sandbox to production, and then switch your Seller Central settings from sandbox view to production.
How can customers use Amazon Pay?
If you already have an account with Amazon, you only have to accept our Customer Agreement when making a purchase on a non-Amazon site that accepts Amazon Pay. There are no additional fees on the customer side.
Purchases are protected by the Amazon A-to-Z Guarantee. However, not all the purchases are subject to reimbursement. Donations are also not disputable.
You can track all the transactions by signing in as a “shopper” at pay.amazon.com using your Amazon username and password. One-time purchases are displayed on the “Orders” tab, and subscription agreements can be found in the “Merchant Agreements” section.
Amazon.com Gift Cards cannot be used as a payment method on third-party websites using Amazon Pay.
Amazon Pay features
The service can be used both for immediate purchases and recurring payment services (subscription products). Deferred payments like pre-order, backorder, order online pick up in-store, etc. can also be handled with this processing method.
You can split payments if you need to spread the total payment amount for the order across multiple individual payments. This will come in handy when the order is sent in multiple shipments or an item requires partial payment upfront.
Amazon Pay also enables full or partial refunds when needed.
Entering less info helps to reduce friction with a seamless payment process that can be completed in minimal clicks. It may also improve cart abandonment rates since 34% of customers consider forced account creation to be a key reason for leaving the website without completing the transaction.
Is it secure?
Another benefit of Amazon Pay besides the speed and convenience is less personal data exposure. Amazon does not share your full credit card, debit card, or bank account number with sites or charitable organizations that accept Amazon Pay. They share only information required to complete your transaction such as the last four digits of your card number and the card type.
Fraud prevention technology used by Amazon protects accounts from fraudulent transactions, lowering business costs and safeguarding merchants. It grants merchants a Payment Protection Policy that allows them to waive chargeback fees for qualifying fraudulent transactions.
Amazon Pay for Alexa Skills
Clicking on any links at all seems redundant if there’s an option to say it for completing a purchase.
To integrate Amazon Pay with your skill, you need the following:
- An Amazon Payments Merchant account,
- an Amazon Developer account,
- Alexa Skills Kit SDK (ASK) SDK,
- an AWS account will be helpful but isn’t compulsory.
More information for developers can be found here.
Pros & cons of using Amazon Pay
➕ You deal with the reputable company and recognizable brand name.
➕ The service has mostly positive reviews.
➕ It’s a great time-saver.
➕ Customers don’t bear additional fees and there’s a transparent pricing policy for sellers.
➖ Sellers don’t get the funds immediately. For initial transactions, payments are held for 14 days.
➖ Merchant fees are similar to other PSPs but merchants who operate mid and high-volume businesses may find cheaper processing options.
➖ The service has a limited regional presence.