Amazon undercuts Square with own mobile card reader

Amazon Local Register

Amazon is taking on Square and PayPal by launching its own mobile card reader, called Amazon Local Register. Although the ecommerce giant hasn't announced the mobile card reader yet, there is a dedicated section for the product on Amazon's site (where it is available for $10), and a YouTube introduction video highlighting its features.

Amazon's mobile card reader will work a similar way as Square's offering in that businesses will be able to take payments by connecting the reader to a smartphone or tablet. Currently, that list includes the Galaxy S3, Galaxy S4 and Galaxy S5 for Android, iPhone 4 and above as well as the iPad, iPad Mini and Amazon's Kindle Fire HD, HDX 7 and HDX 8.9. Along with the card reader, Amazon is offering accessories, which include cases and stands, cash drawers and a Kindle Fire HDX 8.9 bundle that is available for $379. The $10 fee for the card reader itself will be offset by the lack of processing fee for the first $10 worth of transactions.

Amazon will charge 1.75 percent for each transaction, undercutting Square, which charges 2.75 percent, and PayPal Here at 2.7 percent. However, there is a caveat here, as Amazon mentions that the pricing is an "introductory deal" and as such will only be valid up to 1 January 2016. The regular pricing that is being targeted by the retailer is 2.5 percent, which is still less than what Square is charging. Amazon's mobile card reader solution is available only in the US for now.

What do you guys think of Amazon's entry into the world of mobile card readers? Do you think the retailer's strong digital ecosystem of content will allow it to outdo the likes of Square and PayPal?

Source: Amazon; Via: Engadget

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Reader comments

Amazon undercuts Square with own mobile card reader

7 Comments

Intrigued, but not enough as I already have paypal here and square. Keep the rates permanent and transfer funds more quickly... I'd consider it in a heartbeat!

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The question is what Amazon will do with that tracsactional data. Retailers who use the reader would be sharing with Amazon (a strong competitor) what they are selling, at what price, what is hot, etc. I read stories about Amazon adding to its own portfolio products that are hot in its marketplace basically competing with its own marketplace clients. What would stop Amazon from doing something similar with retailers using Amazon's card reader? If I were a retailer I would be worried even if Amazon charges me zero fees.

I'm sticking with second hand stores, yard/garage sales, flea markets, etc. Often cash only markets. Don't need big data making money off of my spending habits, and me not getting a chunk of that change.

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Uhh, guys… this 1.75 per card fee comes with a price: $9.95 a month. Otherwise you get charged pretty much the same as Square if you're an occasional user.
Did not know amazon was contemplating using this as an "introductory" fee. Thanks for the heads-up!

it figures…

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