SEATTLE–Amazon.com Inc. is gearing up to challenge Apple Inc. in the mobile-payments race, according to one new analysis.
Amazon is working to persuade brick-and-mortar merchants to accept its Amazon Pay digital wallet, the Wall Street Journal reported, citing a source familiar with the matter. Amazon Pay is currently primarily used with online purchases.
The initial expansion efforts around Amazon Pay involve gas stations, restaurants and other merchants that aren’t direct competitors, the Wall Street Journal said, noting retailers that view Amazon as a threat could resist the effort.
The overall initiative is part of the company’s efforts to “to further integrate itself into the lives of its customers,” the report stated.
What is less clear is exactly how consumers would use Amazon Pay in stores. The options include tapping their phones checkout, similar to how Apple Pay is used, or scanning a code on their phones, the Journal reported.
According to Apple, Apple Pay was accepted at more than five million in-store locations in the U.S. as of May.
Plans to Overcome Slow Adoption
As CUToday.info has reported, adoption of mobile wallets in the U.S. has lagged many forecasts and represented just 1% of all U.S. card transactions in 2017, according to the Nilson Report.
To speed adoption, Amazon is reportedly offering incentives such as lower payment-processing fees or marketing services to entice merchants to accept its digital wallet, according to the Journal.
Those lower payment-processing costs could find a receptive audience among merchants, the Journal added.
In addition to the focus on mobile payments, Amazon continues to work to make Alexa, its virtual assistant, an in-store payments platform. For example, a customer paying for gas could tell the Alexa voice assistant in the car to use Amazon Pay, the Journal reported.