Is Amazon working on a PayPal clone?
Lisa Ellis, a Sanford C. Bernstein & Co. analyst thinks Amazon could be, or at least would be wise to start, exerting effort to further progress into the payments space by developing a PayPal-like service.
Not only would this cause headaches for PayPal itself but also the likes of Visa and Mastercard. Indeed it does sound like something of a no-brainer because Amazon does already have a decent payments infrastructure in place.
Ellis said in a note to investors this week: “This scenario involves taking a page out of the book of what eBay did with PayPal and Alibaba did with Alipay, and building up independent wallet service based off of the Amazon Payments wallet.” She notes that such a service would be of concern to Visa and Mastercard “specifically if consumers start storing their money in the Amazon Pay wallet and not in their underlying checking accounts.”
It’s the stored value feature of the likes of PayPal that makes them particularly successful. And especially if you sell a few bits on eBay, very often that income is subsequently spent on future eBay purchases. Amazon is well-placed to do something similar.
But it’s more than that. Amazon’s ubiquity and the the scope of their ambition, as well as jeff Bezos commitment to providing ever increasing value to Amazon Prime membership, could make such a service very unstoppable. Amazon Checkout and Amazon Pay are already successful payment methods. A full PayPal clone is an obvious next step and Amazon has the resources to make it work.