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Associated Press
Amazon Local Register is designed to help small-business owners accept payments through their smartphones and tablets.

New payment app unveiled

Amazon to serve mobile small firms

NEW YORK – Amazon is taking direct aim at mobile payment systems such as Square by introducing the Amazon Local Register, a credit-card processing device and mobile app designed to help small business owners accept payments through their smartphones and tablets.

The move places the largest U.S. e-commerce retailer in competition with Square and other established mo­bile payment processing systems such as PayPal Here and Intuit’s Go­Payment.

Sha­res rose 3 percent early Wed­nes­day, the biggest percentage gain on the Standard & Poor’s 500 index.

Amazon’s technology includes a card reader that attaches to a smartphone, Kindle or tablet. The reader processes credit or debit card payments through a secure Amazon net­work, the same one that processes Amazon.com purchases. The service is designed for small-business owners who otherwise might accept only cash or checks, including massage therapists, food truck operators and artists who sell their work at outdoor fairs.

Small businesses can start using Local Register by creating an account at http://localregister.​amazon.com. Businesses must buy Amazon’s card reader for $10 and download the free mobile app from the Amazon app store, the Apple app store or Google Play. The app works on most smartphones and tablets, including the Kindle Fire.

Similar to Amazon’s strategy in many of its businesses, the company aims to compete on price in the mobile payment arena.

For customers who sign up for the service by Oct. 31, Amazon will take as its fee 1.75 percent of each payment processed, or each “swipe” of the card, a special rate that will last until Jan. 1, 2016. For people who sign up after Oct. 31, Amazon will take a service fee of 2.5 percent of each payment processed.

The first $10 in transaction fees will be credited back to the customer, essentially paying for the card reader.

That’s below most of its competitors’ rates. Square takes a fee of 2.75 percent of each transaction. PayPal Here takes 2.7 percent of each transaction, and Intuit’s GoPayment rates start at 1.75 percent per transaction if businesses pay a $19.95 monthly rate or 2.4 percent of each transaction without a monthly payment.

“I’ve actually heard some business owners say the only thing that would make them change (point of sale) systems is cost savings,” said Matt Swann, vice president of local commerce for Amazon.

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