Amazon yesterday announced the launch of Amazon Cash, a new service that allows consumers to add cash to their Amazon.com balance by showing a barcode at a participating retailer.
The cash is then credited immediately to users' online Amazon account. With the service, users would be able to add any amount between $15 and $500 in a single transaction, according to Amazon.
The brick-and-mortar retailers, which would allow Amazon Cash would include CVS Pharmacy, Speedway, Sheetz, Kum & Go, D&W Fresh Market, Family Fare Supermarkets, and VG's Grocery. Other stores would be added in the future.
According to commentators, the service is not very different from a similar offering by PayPal, whose PayPal My Cash Card allowed users to add funds to their online PayPal account, using cash from their wallet. PayPal also had a barcode-only service, powered by Green Dot.
Like PayPal, Amazon Cash too was meant to appeal to the same set of people who might not be shopping online – those who get paid in cash, did not have a bank account or debit card, and who did not use credit cards.
This ''cash customer'' (the unbanked or ''underbanked) comprised 27 per cent of consumers, according to a 2015 report from the US Federal Deposit Insurance Corporation.
According to commentators, new services like Amazon Cash could see Amazon directly square off against Walmart whose customer base included lower-income buyers. Walmart's MoneyCard service is already in operation and had been working to expand into Amazon's territory.
In addition to Amazon Cash, last year, the company allowed people to pay for its Prime membership on a monthly basis, rather than only annually, and also started a pilot programme to deliver groceries to food stamp recipients.
According to commentators, people underserved by banks looked to be gaining more attention from the tech industry, as companies sought opportunities to grow their audiences.
PayPal had made people who did not have bank accounts a big focus, and had most recently agreed to buy TIO Networks in February to help people pay their bills using cash at convenience stores.