Amazon Finesses Payments by Adding Recurring Billing to Its Log in And Pay Feature

By Kevin Woodward

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Recurring billing is now available from Amazon Payments, putting the online payment service from Amazon.com Inc. on more equal footing with competitors that already offer the feature.

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Amazon says it has added the feature within the Login and Pay with Amazon service that enables merchants to accept automatic payments of fixed or variable amounts. Amazon says there is no additional cost to use the recurring-billing feature. Log In and Pay debuted in October.

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And when consumers update their payment cards, such as to replace an expired card, the update applies to payments made to merchants.

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Consumers use the payment and address information stored in their Amazon.com accounts for use at participating merchants. After adding products to a shopping cart, the consumer selects a Pay with Amazon button to use their Amazon payment credentials. Consumers can track payments, view billers they’ve authorized and manage these connections with their Amazon Payments accounts.

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Amazon Payments charges 2.9% plus 30 cents per transaction, with lower fees as payment volume increases. PayPal charges the same standard fee.

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Amazon says it has 244 million active customers worldwide. PayPal says it has 148 million active registered accountholders.

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For its part, PayPal say it has a better service. “Today, millions of merchants trust PayPal to handle the complexities of payments because we help them grow, don’t compete with them, and collaborate with them to bring elegant and amazing shopping experiences to consumers,” PayPal says in a statement. “At PayPal, our primary focus is on making it simple and fast for consumers to send and receive money anyway they want, anytime they want, wherever they are in the world, and we’ve been doing it for more than 15 years.”

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E-commerce payment schemes, too, need similar products to remain competitive, says Beth Robertson, an independent payments researcher based in suburban Baltimore.

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“Most of the leading e-commerce platforms, including those supporting smaller merchants, like PayPal and CyberSource/Authorize.Net, offer recurring-payment capabilities,” Robertson tells Digital Transactions News. “As a result, it is really a competitive necessity for Amazon if they want to play in this market and the mobile-payments space. It broadens the applicability of the Amazon platform and provides more flexibility to support the payment needs of both consumers and merchants.”

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Amazon updated Amazon Payments in August with a “lite” version, that eschewed non-core functions, such as pricing, shipping and inventory-control integrations, in favor of just payment processing.