Amazon Rumored To Release Card Reader, Compete With Square
By Brianna Ahearn, contributing writer
Amazon launched their gift card and loyalty card mobile app Amazon Wallet this month and now rumors have appeared the retailer is preparing to release its own Square-like card reader. A popular Mac blog, 9to5 Mac, has obtained documentation showing Staples will stock an “Amazon card reader” along with the Square card reader in August. If the rumors are true, the new card reader will be a sizable competitor to Square. Square is a card reader that plugs into a smartphone or tablet's audio jack to transmit credit card information to the device to be digitized. The Square app, Square Register, allows a mobile device to be transformed into a mobile point of sale option. Unlike Amazon, which has restricted its Amazon Wallet app to Android devices, the Square app is available for iOs and Android users.
Although details are unknown as to the functions of the Amazon card reader, the industry has been speculating about the retailer's move into the mobile payment industry for some time. In December 2013, the company bought the mobile payment technology of Gopago, but didn't publicly announce their plans for the new venture. The news of the card reader may help shine light on their latest move into mobile payments. According to the Staples paperwork, the Amazon Card Reader will cost $9.99. The documentation also instructs stores to not use the included planogram or signage for the Amazon Card Reader until August 12. At this time, there's no definite release date, nor is it clear if Staples will be the only brick and mortar retailer selling the device.
It's assumed that given the timing of the Amazon Wallet app that the Amazon Card Reader will connect to that software, making it easy for users to process payments on mobile devices. The fees will likely be competitive to Square, which currently takes 2.75% for each card swipe, while PayPal takes 2.7%. According to Business Insider, the Amazon Card Reader is a good move for the company, especially since it estimates 300 million accounts were used to make a purchase on Amazon in the last year. The introduction of the card reader would only expand the opportunity to more customers. In 2011, Square processes over $2 million in payments daily. Amazon would be entering into a competitive market, but their recent moves have shown they're eager for a piece of the mobile technology space. When Amazon Wallet is released in a non-beta version, the industry may see the Amazon Card Reader released soon after.