Amazon (AMZN) announced Friday that it will offer an online payments service that will compete with eBay's PayPal service. The online payment service known as Amazon Flexible Payments Service, or FPS, is intended to let developers build secure payment systems for their Internet sales.
There are a number of great features to the Amazon FPS online payment service. These features include:
- Send and receive money using credit card, bank account or Amazon Payments balance transfer as payment methods.
- Create "Payment Instructions" to define conditions and constraints desired for a given transaction, and programmatically obtain payment authorizations or "tokens" that represent these Payment Instructions from customers.
- Execute one-time, multiple, or recurring payments on behalf of customers.
- Aggregate micro-transactions into a single larger transaction using Prepaid and Postpaid capabilities.
- View account balances, transaction histories, and transaction details on the Amazon Payments web site.
According to the official Amazon blog:
Since we've been processing payments for over ten years, we have a really good understanding of the cost and fee structures which are associated with each type of payment method. The cost to process a credit card, a bank account debit, or an Amazon Payments balance transfer differ greatly from each other. FPS exposes these fees directly, passing on the savings to the developer while also making provisions for the volume discounts available when large volumes of credit card payments are processed. Pricing / Transaction Charges
Amazon Flexible Payments Service fees work like this:
Fees are assessed on a per-transaction basis and vary depending on the payment method used and the transaction amount: For Transactions more than $10: - 1.5% + $0.01 for Amazon Payments balance transfers
- 2.0% + $0.05 for bank account debits
- 2.9% + $0.30 for credit card
For Transactions less than $10: - 1.5% + $0.01 for Amazon Payments balance transfers
- 2.0% + $0.05 for bank account debits
- 5.0% + $0.05 for credit card
For Amazon Payments balance transfers less than $0.05: - 20% of the transaction amount, with a minimum fee of $0.0025
Qualified developers can apply for the following monthly volume discounts for credit card transactions: - 2.5% + $0.30 per transaction for payment volume from $3K- $10K
- 2.2% + $0.30 per transaction for payment volume from $10K - $100K
- 1.9% + $0.30 per transaction for payment volume over $100K
The coolest thing about this online payment service is probably the flexibility in how they can structure payment instructions. Amazon.com, operates retail Websites and offers programs that enable third parties to sell products on its Websites.
Official Amazon Flexible Payments Service (Amazon FPS) page
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