Amazon.com Enhances Payment Options with Bill Me Later
SEATTLE—(BUSINESS WIRE)—Amazon.com (NASDAQ:AMZN - News) today announced it has signed an agreement with Bill Me Later, Inc., a leading provider of alternative payment technologies, to make the Bill Me Later payment option available on the Amazon.com website.
Context & Ripple Effects
In mid-December 2007, at the peak of the holiday shopping window, Amazon signed an agreement with Bill Me Later, Inc. to offer its deferred-payment option at Amazon.com checkout — a '90 days, same as cash' style product, as one syndicated writeup put it, rather than another card in the wallet.
It lands during a year in which Amazon has been broadening what customers can do on the site beyond retail transactions: the company announced a DRM-free MP3 music store drawing on more than 12,000 record labels in May 2007 and acquired dpreview.com, the digital-photography destination, the same month.
First-order effects
- Amazon shoppers gain a way to defer payment without entering card details at checkout heading into the holidays, removing a friction point on high-basket purchases.
- Bill Me Later gets placement on one of the largest e-commerce destinations, converting Amazon's checkout traffic into a distribution channel for its credit product.
Second-order effects
- Card issuers and networks now face an alternative credit rail embedded at the point of sale of a top-tier retailer, pressuring rivals to match deferred-payment options or lose basket share.
- Other large online merchants come under competitive pressure to add similar alternative payment options, since Amazon has normalized paying-by-invoice at scale.
Third-order effects
- If major retailers keep adopting merchant-side credit products, payment choice becomes a merchandising lever — checkout itself turns into contested ground between card networks and independent credit providers, with underwriting risk shifting toward whoever owns the button the customer clicks.
The trend: E-commerce payments are diversifying beyond bank cards toward retailer-integrated deferred-credit rails, with the biggest marketplaces deciding which options reach consumers.