TIME Business

Amazon Launches Online Payment System To Rival Paypal

The e-commerce company’s new feature will allow users to pay using their Amazon accounts

Amazon debuted an online payment system on Monday in an effort to expand into money transfer services, Reuters reported.

The new service will allow over 240 million active monthly users of Amazon to use their stored credit and debit card information to pay for outside subscriptions such as cellphone payments or music subscriptions, for which Amazon will charge a fee.

This subscription billing system is an extension of Amazon’s previous efforts to compete with PayPal and other online payment service companies, such as Braintree, Stripe and Google Wallet. Last October, Amazon announced the “Login and Pay with Amazon” feature, in which partner websites allowed customers the option of paying using information stored on their Amazon accounts.

“[The new service] opens up Login and Pay with Amazon to other types of subscription-based business models, companies who want to make Amazon customers their customers, back payments with the A to Z guarantee and use transparent and low payment processing,” Amazon spokeswoman Julie Law told TIME.

Amazon has gauged the online payment system’s potential by testing the feature on various start-ups that charge recurring payments. Users of mobile phone company Ting that paid with Amazon’s new service spent 30% more on the Ting website, Ting product manager Justen Burdette told Reuters.

[Reuters]

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