Amazon Payments Review 2022

Amazon Payments Review 2022

Amazon has a history of its services in the e-commerce world. Since 2007 Amazon introduced their payment system that their clients can use to pay on online merchant websites. Amazon Pay is a reasonably secure method that enables online shoppers to pay for goods using their Amazon accounts. Amazon Pay allows e-commerce sellers to create Amazon Pay buttons on their websites through minimal work. 

Sellers can receive payments for purchases, donations, and recurring payments through Amazon Pay. Amazon has tried to make it easy to integrate it into your website to encourage sellers into adopting it. Amazon Pay has no monthly fees or long-term contracts like many other popular options in the market, but they do have a standard flat rate for their services. Most of the process is online, and they do not have any costs for signing up.

Amazon Pay is classified as a payment service provider. Sellers need to make an Amazon seller account to benefit from Amazon Pay services. Creating an Amazon Seller account does not need sellers to list their products on Amazon, but Amazon does promote it greatly. One thing sellers have to consider when using Amazon Pay services is their compliance with the Acceptable Use Policy of Amazon Pay. The policy prohibits sellers from dealing in products that are considered high-risk.

Features of Amazon Pay Services

Now that you have a quick idea of what Amazon Pay has to provide for its clients let’s get into some more detail about their services.

Existing Database of Customer Information

Amazon is the biggest online seller in the modern world. This means that they already have the information of several millions of customers around the world. This means that most customers will not have to re-enter their information when buying from your website. This will lead to more overall sales at your end and fewer people leaving items on their wish list.

When someone makes a payment that is processed through a payment service provider, having a previous purchase history also helps avoid extra fees for payment processing.

Personalized Branding at Checkout

If you use a third-party payment service provider, you would not want their brand or marketing to overshadow yours on your website. Amazon Pay allows you to keep your branding and styling throughout the payment experience. While your customers will know that they are paying through Amazon, they will experience the branding elements you want them to.

Recurring Payments

Like many other payment service providers in the market, Amazon allows you to take recurring payments. You can use Recurly to control the billing pattern and frequency just as you would with another third-party PSP. Recurly offers you a fantastic experience with online payment services, streamlining your inflow of cash.

Amazon Trust Factor

While you can find most or even more payment processing features Amazon gives with third-party vendors, the Amazon brand name has its influence. Paying through a well-known brand such as PayPal, Venmo, and several other commonly known payment processors gives potential buyers a sense of trust and safety. 

Customers are much less likely to buy from an online source with a less common method or provider for payments. It is easy to get caught in scams and frauds in the online market, so the fraud protection of big brands always comes in handy.

Drawbacks of Amazon Pay

Even though the features described above are on par with some of the famous names in the e-commerce industry, there are several critical drawbacks to the services of Amazon Pay. While the positive features are attractive, the disadvantages matter when choosing a suitable payment processor for your website. So, you need to research and compare your options carefully before you commit to a provider.

Delayed Payouts Due to Amazon Reserve Policies

New users have to face the frustration of having 100% of their earned funds reserved by Amazon for seven days before getting the payout for their earnings. While they offer a lesser restrictive (but still restrictive to a great extent) “reserve tier,” sellers need to complete 100 orders with an order defect rate of only 1%. 

This can be a huge problem for new sellers as getting orders is hard enough already. Plus, the reserved payouts mean lesser capital for future orders. Smaller businesses can struggle significantly because of this.

Making an Amazon Seller Account

Setting up Amazon Pay is not an issue for people who already have an active Amazon Seller account. But it is improbable that you have an account if you have not already listed your items for sale on Amazon.

Setting up a new Amazon Seller account is a time-consuming process. And often, it can take a lot of time before you can even get to integrating Amazon Pay into your website. Based on your level of expertise and the time it takes to get an Amazon Seller account approved, it can take a lot of your precious time before you can start selling your merchandise.

Integration With Several E-Commerce Platforms is not Allowed

Having a streamlined checkout and payout process depends significantly on having multiple options and choices. Each e-commerce platform has its pros and cons, so using a combination of platforms is always beneficial.

Unfortunately for Amazon Pay users, the service refuses to partner with several popular payment platforms such as Squarespace, Square online, and Wix, one of the most popular website building platforms. This is a move that Amazon has made to inhibit the growth of competing payment services. But in the end, the sellers and buyers have to sacrifice their comfort to comply with Amazon Pay regulations.

Excessive Processing Fees

Most payment services offer incentives and discounts in the modern digital age, especially if their clients have a high sale volume. But Amazon Pay has no such offers for the sellers that use their services. So, if you are a seller that deals in very high volumes with low profit margins, this is your final red flag to choose another payment service provider.

Conclusion

The only thing that Amazon has to offer is the trust factor for your customers. Other than that, most of the features that Amazon Pay offers are more or less the same as several different payment options. But you should consider the damage your business might suffer due to Amazon holding your payouts. Even if you get the less restrictive “reserve tier,” a portion of your funds will always be reserved. 

If versatility in integration with other payment platforms, better offers for higher sales volumes and more control over your funds are something you desire in a payment service provider, then you should probably look for other options!