Joe Kleinwaechter, vice-president of Innovation and Design at Worldpay US, told iTWire in response to queries following the launch of Amazon Cash this month, that to compare the service against Apple Pay, Samsung Pay or Android Pay was "an apple to oranges comparison".
Amazon Cash is aimed squarely at those who want digital cash for transactions but have no means of topping up online.
Kleinwaechter said: "The xPay cadre is based on credit or ACH systems, which require the consumer to have a bank account or credit card. Amazon Cash appears to target unbanked and underbanked consumers to convert them to Amazon customers.
"There really is no risk if the expectation is to replace that mechanism. But, what remains to be seen is whether they can attract any additional market share by streamlining this process."
Asked if Amazon was too late to the market and whether a half-and-half service was going to make the cut, Kleinwaechter responded: "Not at all. I think Amazon is going after a fixed job-to-be-done – provide purchasing power to cash only customers. Currently, 7% of consumers are unbanked and an additional 20% are underbanked. That’s a big opportunity, if you have the right solution."
Given that the US is now pushing for digital payments - as underlined by its being behind the moves in India to lessen cash transactions - Kleinwaechter was asked if it was in any way peculiar that Amazon was seemingly encouraging people to keep using cash.
He disagreed with this conclusion. "I don’t think Amazon’s encouraging the use of cash, it's simply responding to a market need. Consumers are unbanked and underbanked for a reason. They often don’t have access to or choose not to have access to traditional credit systems and are challenged by paying in ways banked customers do.
"Traditionally banks have ignored this population, as they weren’t candidates for the margin-rich service upsells that make customer acquisition costs worthwhile. Amazon Cash is a valuable service, but whether it will be a good source of profit or a loss leader for future offerings remains to be seen."