Payments

Amazon developing PoS to compete with PayPal, Shopify

Amazon has set up a dedicated taskforce with the intention of planning a point-of-sales (PoS) solution that can compete against e-commerce industry leaders Shopify and PayPal, according to internal Amazon documents released by Business Insider.

The new PoS system, titled “Project Santos”, will be available to third-party sellers, be able to handle both online and offline transactions, and include connections to the company’s other services including Amazon One, Prime and Flex.

An internal Amazon team is developing the product with the intention of competing with Canadian Shopify and PayPal, which have both boosted online revenue during pandemic’s quarantine and subsequent move to remote work, according to Reuters.

The development move showcases Amazon’s ongoing movement into small- and medium-sized business ecosystems, with plans to meet these companies where they want (online or offline).

Targeting brick-and-mortar locations is an interesting move from the online giant, but the sheer magnitude of their presence online may explain why they want to diversify revenue sources. The fact non-ecommerce retail sales are expected to rebound to $5.15 trillion this year also couldn’t hurt, according to Insider’s e-Marketer.

The documents state connections to Amazon’s wide range of logistic services, enabling capabilities in the the PoS system not currently offered by SMB competitors, according to PYMNTS.

The system also targets payment processors including Square and PayPal, showing the retail giant also wants a piece of the business management market. Amazon recently started a partnership with Australian BNPL Affirm to introduce BNPL functionality into their storefronts, which I expect will be directly integrated into their new PoS system.

In other recent fintech news, Scalapay raised Europe’s largest equity funding round with a $155 million Series A led by Tiger Global Management. Varo Bank also raised a $510 million Series E led by Lone Pine Capital to continue development of new banking products and technology.

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