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Amazon Offers Retailers Discounts to Adopt Payment System

  • Move shows retailer is willing to sacrifice to grow Amazon Pay
  • It’s another challenge to PayPal, big banks and card networks
Bloomberg business news
Bloomberg’s Spencer Soper reports on Amazon’s payments service plans.(Source: Bloomberg)
Updated on

Amazon.com Inc. is offering to pass along the discounts it gets on credit-card fees to other retailers if they use its online payments service, according to people with knowledge of the matter, in a new threat to PayPal Holdings Inc. and card-issuing banks. 

The move shows Amazon is willing to sacrifice the profitability of its payments system to spread its use. Swipe fees are a $90 billion-a-year business for lenders such as JPMorgan Chase & Co. and Citigroup Inc., networks including Visa Inc. and Mastercard Inc., and payment processors like First Data Corp. and Stripe Inc., which pocket a fraction of every sale when shoppers swipe cards or click “buy now.”