By offering a Pay with Amazon option at their checkout, online retailers give customers a way to avoid creating an account and pay using their Amazon payment options (often meaning they don’t have to enter card details etc). By making the checkout process quicker and easier for new customers, retailers can boost sales and increase conversion rates. For small retailers without the time and resources to create their own payment system, Amazon Payments could be a worthy substitute.

There are two main benefits for Amazon in expanding their payment gateway service: firstly, any sales processed through Amazon Payments will generate revenue for the eCommerce giant, as they charge retailers a toppy 3.4% of the total transaction for domestic UK transactions, plus a 20p fee. There are a large number of retailers that use third-party platforms - Shopify alone has over 240,000 shops - so this could be a valuable source of revenue for Amazon.

The expansion of their Payments service puts Amazon in direct competition with the likes of banks and credit card companies, including Worldpay, SagePay and Paypal, the latter of which processed an average of 12.5m payments a day in Q1 of last year, illustrating just how lucrative the market is.

If you are a small retailer, whether or not you are using a third-party platform, integrating Amazon Payments into your checkout comes with several benefits that could make it an interesting proposition for you. For starters, Amazon provides integration support and certification review for new partners, meaning that implementing Amazon Payments into your checkout process should be a fairly painless experience.

In addition, becoming a partner with Amazon could help build trust with new customers. Many small retailers struggle to get off the ground as shoppers are less inclined to buy from an eCommerce retailer they haven’t heard of before. By displaying an Amazon trusted partner certificate on their website, consumers are more likely to feel comfortable buying from you. Amazon partnership also has numerous marketing benefits, such as the retailer’s logo being listed on Amazon’s partner website. You can read Amazon’s full terms and benefits of becoming a partner here.

If you are a small retailer using a third-party platform, it may be worth considering implementing Amazon’s payment gateway into your checkout, as it has the potential to increase conversions and appeal to Amazon’s customer base. If you currently use a payment gateway, this is a good opportunity to review your checkout process and decide whether adding (or replacing your current gateway with) Amazon Payments could be beneficial for you. Additionally, an extra payment gateway player,in the market could help drive down fees, meaning better value for retailers.

Although Pay with Amazon or similar services could be appealing for some retailers, some larger retailers with effective checkouts already in place aren’t going to be interested in paying Amazon commission for something they can already do. Adding a third party payment gateway isn’t completely necessary for retailers and could result in lost revenue due to the commission, so it’s worth carefully considering whether a payment gateway is right for your company.