Amazon and its fintech ecosystem

Today Amazon celebrates its 25th anniversary. Find out how it evolved from e-commerce and AI to the whole FinTech ecosystem

Amazon and its fintech ecosystem. Source:

Today, Jeff Bezos is considered to be the richest man in the world, while his Amazon is not just a large marketplace, but also one of the most prominent technology companies worldwide. Slowly but surely, Amazon has been moving from just an online store towards its own fully-fledged financial ecosystem. And it would be wrong to say that this concept isn’t working out.
PaySpace Magazine offers you a list of Amazon’s financial services, which together form this very FinTech ecosystem we are talking about.

As we mentioned above, today Amazon has a growing financial services ecosystem:

1. Wallet and payments network (Amazon Pay)

Amazon Pay is a wallet for users and a payments network for both online and bricks-and-mortar merchants. The mobile wallet has no less than 33M users.

Essentially, Amazon Pay is Amazon’s online payments processing service that was launched in 2007. This service offers consumers an option to pay with their Amazon accounts on external merchant websites. In early 2019, Amazon Pay was available in 18 countries.

This service includes multiple products for consumers and merchants to process online payments.

Thus, you can buy things online with the help of your address and payment method, which are stored in your account.

2. Cash deposits (Amazon Cash)

Amazon Cash connects offline and online commerce by allowing users to top up digital accounts (with cash) at partnering retailers.

In other words, it is a way to buy goods and services from Amazon without a bank card. To implement this, you’d just have to top up your Amazon Balance (at a special location).

This option doesn’t include any fees or interest. Moreover, the service is a well-secured one, since it requires a personal barcode or verified phone number when you use it.

How does it work?

  1. A consumer brings paper money to a specific location (Amazon provides users with a list of participating points) and asks for Amazon Cash.
  2. A consumer uses a barcode (which is provided by Amazon) or a phone number in order to verify their identity.
  3. The last step is to top up from $5 to $500.

3. SMB lending (Amazon Lending)

Today, there are more than 5M retailers on Amazon’s marketplace. Most of them are small businesses, and it means that most of these merchants would need small business financing sooner or later.

It is not a big secret that taking a loan is not, to put it mildly, the easiest quest. Of course, there is an option to go to the bank and get a loan, but there is a strong possibility that the request will be denied. Moreover, statistics say around 80% of small business owners that request a loan (referring to commercial banks) get a denial. And yes, there are other alternative lenders, but requesting a loan from them usually takes so much time/effort. However, it does not apply to all lenders. But entrepreneurs that run a business know that time is money, and sometimes there is no time to seek the “right one”.

Today, there are more than 5M retailers on Amazon’s marketplace. Source:

Amazon offers business loans from $1K to $750K (for one year) but for registered Amazon sellers only. Has it worked out? According to CNBC, Amazon lent $1B during 2016.

Nonetheless, you shouldn’t forget that Amazon Lending is available for small businesses and for registered sellers only. That means you can’t just apply to this program. You need to register on Amazon as a merchant and sell goods or services through the marketplace. Furthermore, Amazon checks the merchants, and only after certain verification invites you to participate in the Amazon Lending program.

Some experts say that the Amazon Lending loan program is somehow similar to a merchant cash advance (MCA). That is to say, Amazon loans you money, but only being sure you’ll keep co-operating with them, selling your goods or services through their marketplace. Essentially, an Amazon Lending loan is a short-term loan.

4. Member rewards (Amazon Reload)

To minimize Amazon’s interchange fees, Amazon Reload incentivizes Prime users with 2% cash back when they use a digital Amazon debit card.

5. Insurance (Amazon Protect)

Amazon Protect offers accidental damage and theft insurance in EU countries, partnering with the Warranty Group’s London General Insurance Company.

Extended warranties, accidental damages and theft insurances are available for purchase from your device's product detail page on Amazon. After purchasing an insurance policy for your product, you'll receive an automated e-mail that includes the details of your insurance and an official confirmation of purchase. Alternatively, you can also view your policy documents in Your Account, by visiting Your Orders, locating the applicable order, and clicking View Policy Documents

6. Credit cards (Amazon Store Card)

Amazon offers their Store Card and Prime Store Card in partnership with Synchrony Bank. The card can be used at some websites and retailers.

What is more, a Chase consumer credit card offers 3% cashback on Amazon and Whole Foods purchases.

SEE ALSO: Throwback Thursday: Tencent and its fintech ecosystem