Friday , December 2 2022

Will it be one thing to pay by hand? Should it be?

Amazon is experimenting with a way to enable customers to use biometric palm printing to authenticate payments in physical stores that go well beyond Amazon’s brick-and-mortar stores (Whole Foods, AmazonGo, AmazonBooks, Amazon 4-Star, and) Amazon Pop -Up). Amazon is reportedly investigating QSRs (fast food restaurants), especially coffee shops.

Handprints offer several advantages over common mobile biometric methods, such as B. Fingerprint (prescription medication, cleaning chemicals, burns, and various other things that can interfere with fingerprint measurement) and facial recognition (delicate method that requires the face to be an exact distance from the scanner) – not an inch too close or too close far away – and can suffer from hair growth, lighting, cosmetic changes, some sunglasses and false alarms for close relatives. And in contrast to my preferred biometrics for security (retina scan), it is far less invasive. It’s pretty accurate, practical, and should be well received (aside from forcing customers to take off gloves, which could be a problem with outdoor shops in winter).

Choosing independent palm prints would run counter to the industry trend of simply resorting to the authentication that a buyer’s mobile device uses. For Amazon, however, this is not a big challenge, and it has the potential to increase the brand’s presence outside of the relatively few stores it owns. In practice, it could greatly increase the data it contains about buyers and target specific information from a single view of the customer, in which it could spy on Amazon customers (I’m sorry. I thought I was watching) and how they did they like their coffee, burger, pizza or scarves. If there’s the possibility of an upsell anywhere on the planet, Amazon is there.

"Amazon has recently started working with Visa to test terminal transactions and is in discussions with Mastercard." The Wall Street Journal written down. "JPMorgan Chase & Co., Wells Fargo & Co., and Synchrony Financial have expressed interest in allowing card accounts for consumers to work with these terminals."

Amazon has had its own credit card for years – along with the rarely used AmazonPay in the store – but a Palm approach would potentially increase visibility (both for non-Amazon buyers to see and strengthen the Amazon brand, as well for Amazon, you see purchases from people outside of the current Amazon universe) while getting a likely cut in those sales. Let us address the central brand problem. If the retailer is small and relatively unknown (Phils House of Bait or Mollys House of Coffee, which is not as terrible as everyone says), do customers feel more comfortable seeing the Amazon brand they know?

Sanjay Sakhrani, analyst and general manager for payments at investment banking firm Keefe, Bruyette & Woods, issued a customer recommendation that the biggest obstacles to Amazon’s efforts are financial and pragmatic.

"For example, it is unclear whether merchant acquirers play a role or are circumvented. How (will) the system detect and alleviate fraudulent transactions? Conclusion: Although this seems to be an interesting innovation in the payment industry, it is." is still at an early stage in the process and the value proposition for consumers and retailers remains unclear. We believe that the takeover ultimately depends on 1) the cost for merchants and whether there is an incentive for them to add this payment method at the point of sale. 2) whether customers find it useful, especially when contactless payments are becoming more widespread both in the US and internationally; and 3) whether merchants want to promote Amazon at the point of sale and collect data on their behalf due to competition concerns; "Sakhrani’s advice said." Note that Amazon’s previous payment initiatives, such as the Amazon Pay digital wallet, have not yet grown in importance due to, among other things, perceptions of merchant conflicts. Although it is too early to determine the impact, it currently seems to be possible. This will be the most disturbing to payment terminal manufacturers like Square. We will monitor developments to determine any impact on merchant acquirers and possibly V / MC and card issuers if the product is widely used. "

In an interview with Computer worldSakhrani addressed some of his financial concerns. Does Amazon want to add their own fee in addition to an existing exchange fee? Most traders are already pushing for what they see as excessive fees. "Where’s the compromise?" Sakhrani asked. In other words, many retailers already see Amazon as a rival (because it is). So the argument is whether Amazon would help send customers to this local retailer. If the Amazon cut makes it worthwhile for Amazon to use its huge website, for example to send Cincinnati Amazon users to a Cincinnati coffee shop that uses Amazon’s Palm Checkout system, this could have potential.

Note that this would be a radical change for Amazon. Sending customers to anything they don’t own scares the collective spikes of the Amazon marketing department.

Another question Sakhrani had: "Does this terminal accept everything or just Amazon?" In other words, if a buyer wants to pay with a debit card that has nothing to do with Amazon and avoids the Palmswipe, will the terminal allow it? If not, does Amazon have in mind that these terminals would be in addition to a POS that would accept everything else? If so, these machines should be free or it is crazy to assume that every dealer would pay for the privilege. Sure, the retailer would pay an additional small processing fee for buyers that Amazon sends to the store, but don’t even think of a monthly fee for free advertising.

The most comforting detail here is that Visa and Mastercard are involved in discussions. Of course, these brands are involved in discussions about thousands of options every day. How serious are the discussions? How high are the people involved? If both brands are behind a Palm authentication approach – regardless of whether it’s from Amazon or not – things could get very interesting very quickly.

About Nikola Dodson

She is a Chicago blogger and tech enthusiast.

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