We’ve got the latest payments news and what’s trending in fintech and the payments industry from around the globe. With 33 million online checkout activations, Amazon has partnered with e-commerce platform BigCommerce to extended the reach of Amazon Pay. Third-party sellers using Fulfillment by Amazon may face up to $2 billion in tax liabilities in 18 US states because of Amazon’s growing infrastructure and footprint according to a report from Capitol Forum.
With 200 million active customers, PayPal is much bigger than Amazon’s 33 million active users but Market Realist sees big challenges and competition ahead for PayPal. By next week, all 13,000 US Wells Fargo ATMs will be upgraded to allow customers to access and manage funds using a mobile app in addition to traditional cards.
In Poland, nine rival banks teamed up to create a new e-wallet called Blik which now has more than 3 million users doing 2 million transactions a month. Paytm launched free insurance coverage up to $305 for its mobile payment account users in India. After one year, Apple Pay is struggling to gain a foothold in the $5.5 trillion Chinese mobile payments market dominated by WeChat and Alipay partly because the iPhone user base is less than 10% in China.
Fintech startup Splitit lets consumers use existing credit cards and divide the total cost of a purchase into 12 convenient, interest-free payments. After launching in the US a year ago, it is now focusing on the EU market. yStats said credit cards are the most popular online payment choice by consumers in Latin America except Mexico where PayPal is preferred. In the Middle East and Africa, yStats reported that cash on delivery (COD) was the preferred payment by two-thirds of consumers with the exception of South Africa.
On a Growth Trajectory, Amazon Pay Looks to Go ‘Beyond the Button’ in 2017
Amazon.com Inc. announced an integration this week with an e-commerce platform called BigCommerce for its Amazon Pay service, but the company also clearly entertains big ambitions for the payment product it organized as a business in 2015.
For now, Amazon Pay is on an upward trend. Some 33 million consumers, half of them members of Amazon Prime, have activated the checkout service. The company won’t say how many merchants accept it, but the number has more than quadrupled over the past two years. “The merchant base has grown very nicely,” Patrick Gauthier, the former Visa and PayPal executive who is vice president of the Pay With Amazon unit, tells Digital Transactions News.
Overall, payment volume has quintupled since 2015. Indeed, 32% of that volume last year originated on a mobile browser or app, with that number reaching 36% in December. Now, integrations like the one with BigCommerce, which supports more than 50,000 e-commerce merchants, are expected to give Amazon Pay a further boost. Via digitaltransactions.net
Do You Have to Pay Sales Tax For Selling Online? Amazon Sellers Face Nearly $2 Billion In Missed Taxes
Amazon.com’s third-party sales doubled in 2016, but many of those sellers, who use the online retailer’s Fulfillment by Amazon service, may be liable for $1.9 billion in missed sales tax payments in 2016 as a result of Amazon’s growing inventory storage infrastructure.
By moving third-party sellers’ inventories from state to state—including 18 states where storage at a fulfillment center makes the product’s originator liable for sales tax—without “clear notice,” the Seattle-based e-commerce giant left them obligated to pay taxes on sales in those states, according to a report from the investigation and analysis service Capitol Forum. Sellers whose items were stored in those 18 states also owed the states sales taxes even if their products were later sold on non-Amazon websites, the Capitol Forum found.
Sales by Amazon itself became liable for state sales taxes about four and a half years ago. As of Tuesday, the company paid sales taxes on items shipped to 42 states and was poised to add Idaho and Hawaii to the list in April. But for sales taxes resulting from the Fulfillment by Amazon program, the e-commerce giant places responsibility on its third-party sellers’ shoulders. (Tax advisory sites like TaxJar and Avalara offer guides to keep sellers from getting slammed with sales taxes they may have missed.) Via ibtimes.com
PayPal or Amazon Payments: Which Is the Steeper Hill to Climb?
PayPal (PYPL), the king of digital payments, has nearly 200.0 million active customer accounts. Amazon Payments, a rival service by e-commerce giant Amazon (AMZN), boasts 33.0 million users.
PayPal added ~21.0 million new active users over the last year. Amazon Payments added ~12.0 million users over the same period. As such, PayPal is adding new users faster than Amazon Payments despite Amazon’s already large size.
As the originator of digital payments, PayPal faces stiff competition from payment services such as Amazon Payment, Alipay, and JD Finance, which are all affiliated with e-commerce providers. But it also faces competition from stand-alone payment processors such as Square (SQ) and Visa (V). Via marketrealist.com
Wells Fargo says all its ATMs soon will take smartphone codes, not just cards
Wells Fargo plans to upgrade all 13,000 of its ATMs next week to enable customers to access their funds using their cellphones instead of traditional bank cards. Although banks such as JPMorgan Chase and Bank of America have announced similar upgrades to their ATMs, those are still only in certain markets, such as San Francisco, Miami and New York. Wells Fargo would be the first to upgrade all its ATMs with the feature nationwide.
To access their money, customers would get unique eight-digit codes from their Wells Fargo smartphone app, and enter the code into the ATM along with their PIN. The machines will still accept debit cards as well.
One limitation of the one-time code, though, is that it won’t work on the secure doors at many branches that require a customer to swipe an ATM or debit card to gain access to ATMs during non-business hours. Wells Fargo said those secure doors are found at a small percentage of branches, mostly in major metropolitan areas. Via latimes.com
PayPal Prompts Poland’s Banks to Team Up for Rival Payment App
Banks competing in one of Europe’s most cut-throat markets decided to team up on a new technology that allows their customers to leave their wallets at home.
The Polish startup, named Blik, enables customers of nine banks to draw cash from ATMs, wire money using telephone numbers and pay for goods or services on the internet and in shops without sharing card or bank data. Two years after its launch, it has 3.5 million users and enables 2 million transactions per month.
The venture is part of lenders’ effort to accelerate their digital transformation to reduce costs and win more clients. Poland’s banks have caught up and in some instances leapfrogged western peers just 20 years after Citigroup Inc. introduced the country’s first mass-scale credit card. Blik is seeking to take a piece of the financial-industry pie reserved for digital companies such as PayPal Holdings Inc. as well as the payment system mechanism of credit-card issuers.
Blik is incorporated in banks’ mobile applications and directly linked to users’ accounts. It bypasses card issuers and other outside mobile-banking providers, differentiating the system from those introduced by giants such as PayPal, Apple Inc. and Alphabet Inc. Via bloomberg.com
Paytm launches e-wallet insurance
New Delhi: Digital payments firm Paytm, run by One97 Communications Pvt. Ltd, on Tuesday announced an insurance cover for users of its mobile wallet services against unlawful debits from the wallet. The facility will be given free of cost.
Customers using Paytm wallet will be insured up to Rs20,000 ($306) or the last recorded balance in their wallet, whichever is lower, the company said.
Paytm will refund money the user claims to be unlawfully debited from his or her e-wallet as a result of theft, burglary, loss of device or unauthorized access of Paytm account. In the case of such an event, the user will have to notify Paytm through email or call its customer care centre within 12 hours. Via livemint.com
Apple Faces Tough Competition in China’s $5.5 Trillion Mobile Payments Market
Dong Ximiao was buying a meal at KFC in Hangzhou on a recent Sunday and pulled out his phone to pay, like everyone does in China, when the cashier asked: “Alipay or WeChat Pay?”
The problem was, Dong wanted to use Apple Pay for the 36 yuan ($5.20) bill, but the cashier told him she had never handled transactions before and wasn’t sure whether it was accepted at the fried-chicken outlet. “I knew for sure KFC stores accept it,” said Dong, 39, a researcher at Renmin University. “So I ended up teaching her step-by-step how to complete the transaction, and she was surprised at how easy it was.”
A year after introducing its payments technology to China, Apple Inc. is struggling to win share in the $5.5 trillion market, even with the backing of the country’s biggest banks and clearing network. That’s partly because there are fewer iPhones, which made up just 9.6 percent of smartphone sales last year. But mainly, consumers are far more accustomed to using Alibaba Group Holding Ltd.’s affiliate Alipay and Tencent Holdings Ltd.’s WeChat Pay, which have been available for several years and work on all mobile devices, including iPhones. Via bloomberg.com
Splitit’s interest-free installment payment solution focuses on Europe
Splitit enables consumers to pay for online purchases with interest-free monthly payments. The fintech startups lets consumers use their existing credit cards and divide the total cost up to 12 payments. Ecommerce News talked to the company, which is now aiming most of the marketing efforts towards Europe.
Splitit gained success in the US market and is now focusing more and more on Europe, where it launched its project in January last year and now has customers such as Compex, Plum Fashion and Vestiaire Collective. It won in the category ‘Card innovation of the year’ and was highly commended in the category ‘Best online payments solution (consumer)’ during the Payments Awards 2016 competition. Via ecommercenews.eu
Credit cards are the most popular online payment method in Latin America, reveals yStats.com
International consumer surveys cited in the yStats.com report show that credit cards are the top online payment method in Latin America and worldwide. However, there are deviations amongst consumer preferences in various Latin American countries.
About three-quarters of Brazilian online consumers prefer to make purchases with credit cards. Notably though, many of these credit cards are domestic, making up about half of 2015 E-Commerce sales in Brazil. Boleto Bancario came in second in terms of share, with international credit cards following in third. In Argentina, credit cards were also the leading used online payment method.
Mexico presents a different case. The yStats.com report cites a survey from 2016 showing PayPal as the top online payment method, with debit and credit cards next. Both PayPal and debit cards improved by a few percentage points in share of digital buyers from 2015 to 2016, while credit card decreased. Via prlog.org
Cash on delivery is the leading online payment method in the Middle East and Africa
Emerging markets like the Middle East and Africa have digital buyers who use cash on delivery the most for online purchases. Different surveys cited in the yStats.com report show that over half of digital buyers from countries like Nigeria, Kenya, and the UAE favor cash on delivery over other payment methods. Digital retailers in the Middle East and Northern Africa conveyed that over two-thirds of sales are paid in cash on delivery.
However, South Africa is an exception to this trend, with a large share of online customers making purchases via bank cards. Nevertheless, over half of South African digital consumers would make more online purchases if cash on delivery was an available option.
This yStats.com report also reveals that there is room for growth among digital payments, especially with mobile. A two-digit share of surveyed Middle Eastern customers in 2016 stated they were willing to use payment methods other than cash or bank cards, leaving mobile wallets as one of the leading three options. In addition, Africa contains the highest number of mobile money users worldwide. Via prlog.org
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