The website 9to5mac.com has published internal documents from Staples, which appear to indicate that the office supply retailer will be selling an Amazon-branded payment card reader. The Amazon card reader will sell for $9.99 and could be available as soon as Aug, 12, according to the Staple’s documents. The product, if launched, will likely compete directly with Square and PayPal among others. Some providers of mobile card acceptance have found that processing payments for micro-merchants is unprofitable as a standalone business.
Even Square’s profitability is uncertain, and that company is arguably the most successful provider of these services. Product development at Amazon has often conveyed minimal concern for short-term financial performance. However, the company could increase a card reader’s financial viability by leveraging the relationships it has already formed with sellers in the online world.
Amazon’s stock price has declined since the company reported a net loss in the most recent quarter. It will be interesting to see how Wall Street reacts to the company’s potential entrance into a new business with extremely thin margins, given the recent profitability issues.
Overview by Michael Misasi, Senior Analyst, Credit Advisory Services
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