Amazon Shares Rise After Credit Card Reader And Mobile Payment Service Debut

Amazon is now the largest ecommerce retailer in
payments, competing with Square and other
established mobile payment processing systems.
Amazon shares are up more than three percent
after it introduced a credit card processing device
and mobile app. It's targeted at small business
owners and will allow them to accept payments
through their smart phones and tablets as
opposed to traditional POS systems.
The Local Register directly competes against
companies that offer a similar service, including
Square--the first company to offer online
payment services to small businesses in 2010.
Windsor Holden, research director at the Juniper
Research consultancy, said Amazon's Local
Register represents a serious challenge for Square
and other providers.
"Given the size and scale of the company relative
to Square, Amazon is in an exceptionally strong
financial position," Holden told BBC News.
"Square may now find itself struggling to compete
on an equal basis."
He went on to say there is still a sizeable window
for big brands to exploit this market and Amazon
will use the consumer trust it has to offer an
effective cash register for small businesses.
Amazon is currently offering a discounted
introductory rate of 1.75 percent on Local
Register transactions, increasing to 2.5 percent
next year. However, that's still cheaper than both
Square and PayPal services, which charge 2.75
percent and 2.7 percent per swipe respectively.
A spokesperson for Square commented: "We've
long been focused on building a complete register
service for local business. This reinforces our
mission and shows the demand for all of our
services."
Like Square, Amazon's Local Register will include
a card reader that attaches to a smartphone,
Kindle or tablet. The reader then processes credit
or debit card payments through the same network
that processes Amazon.com purchases.
The card reader costs $10, but the first $10 in
transaction fees will be credited back to the
customer. The customers Amazon is trying to
serve with its Local Register are small businesses
that may otherwise only accept cash or checks.
Rather than credit the user's bank directly, Local
Register adds the sum to their Amazon Payments
account. It will also offer the ability to create
reports about sales trends that show small
business owners how specific product categories
performed over a certain time frame.
There are a growing number of credit card
payment gateways that your company can now
choose from. Stay competitive by keeping up-to-
date on the trends and technology that could help
your business run smoothly as it continues to
grow.