Have you heard that Checkout by Amazon (CBA) is going away?
If not, and you're relying on CBA for payments, then you're going to need to make some changes.
Fortunately,Amazon has given you plenty of advance notice about the upcoming change. You'll have more than enough opportunity to prepare your site so that you can still receive payments with Amazon.
Here's what you need to know about Amazon discontinuing CBA.
On April 1, 2017, customers on your website will no longer be able to use CBA to pay for products or services.
If you currently use CBA on your site, you have until August 1, 2017 to ship any orders paid for with the service.
Customers have until December 31, 2017 to ask for refunds from vendors who use CBA. After that, requests for refunds will no longer be honored.
On January 1, 2018, Amazon will stop supporting CBA completely.
Pay With Amazon
Just because Amazon is scrapping CBA, that doesn't mean the company is getting out of the payment processing business completely. Amazon is effectively replacing CBA with a new service called Pay with Amazon.
At this point, Amazon is encouraging sellers who use CBA to migrate to the new service. If you're one of the merchants who needs to migrate, the company promises to support you every step of the way.
If you're a "bottom line" type and you'd like to know what the new service will cost you, it's a processing fee of 2.9% of the total purchase price plus an authorization fee of 30 cents. You'll also have to pay taxes where applicable.
That's only for domestic purchases, though. The cross-border processing fee is 3.9%.
Basically, a $10 order from a U.S. citizen will cost you 59 cents. The same order from a Canadian citizen will cost you 69 cents.
Benefits of Pay With Amazon
So what are the benefits of Amazon's new payment service? There are several of them.
For starters, you get inline address and payment widgets that keep focus on your website. If you've worked with other payment processors in the past, you might have noticed that some of them do a poor job of keeping the customer on your site. Pay with Amazon is a cut above those other options.
Also, Pay with Amazon handles recurring payment options. So if you're selling a service online that requires monthly renewals, Amazon will handle the monthly payment processing for you so you can focus on more important things.
Pay with Amazon is also optimized for mobile sites. That's a must-have in this day and age.
Finally, Amazon's new service also supports payment for digital products. That means if you're selling a non-physical item that doesn't require shipping, like Software-as-a-Service, you can offer your customers a Pay with Amazon option.
Implementing Pay With Amazon
So what do you have to do to implement Pay with Amazon on your website? That depends on your platform.
Pay with Amazon supports the following hosted platforms:
If you're not using one of the hosted platforms listed above, you can still use Pay with Amazon on your website. Amazon offers a button generator that you can use to create a "Pay with Amazon" button. Then, you can just add that button code to your website on the checkout page.
If you require something more sophisticated (i.e., you need to use the Pay with Amazon API features), you should take a look at the Pay with Amazon integration guide.
The bottom line: Amazon will accommodate you no matter how your site is set up. You just might need to enlist the aid of some professional developers to make it happen.
The Important Part: Getting Paid
So how do you get paid once you've made the switch to Pay with Amazon?
For starters, money will still go to the bank account that you've set up with Seller Central. So you don't have to worry about configuring a new bank account or entering the specifics of the same bank account all over again.
Typically, you'll receive your first payment about two weeks after you set up your Pay with Amazon account. After that, you should see money go into your account on a daily basis.
Of course, the caveat there is that Amazon holds back some money on reserve. That's just in case customers request a refund. Amazon also uses some of the reserve to handle A-to-z Guarantee claims.
If you've been using CBA, then you're probably already familiar with the concept of a reserve. Rest assured you'll get that reserve money back after you've made the switch to Pay with Amazon.
You won't get it back quickly, though. Amazon will hold on to it for 90 days just in case any loose ends need to be tied up. After that time, your CBA reserve money will be refunded to you.
A Key Difference
While CBA handled order management, Pay with Amazon is focused on payment processing. That means you won't be able to manage orders with the new service.
Pay with Amazon keeps track of what you charged a customer (including shipping and handling). However, the service doesn't provide order details, such as shipping subtotals and sales tax. You also won't see reports about how many items a customer purchased.
Basically, you need to think about Pay with Amazon as a tool that streamlines how you collect money and not a tool that handles your entire order process.
FAQ - A Few More Things You Might Want To Know
What follows are some frequently asked questions about the Pay with Amazon service.
Do I Have to Create a New Account?
Yes, your CBA account won't automatically become a Pay with Amazon Account. You can sign up for Pay with Amazon by going to the Amazon Payments page and clicking on the "For Merchants" button.
Will Pay With Amazon Calculate Sales Tax?
No, Pay With Amazon doesn't calculate sales tax. That's just one way that the new service is different from CBA.
If you need to calculate sales tax, you'll have to find a separate tool to do that.
Will Amazon Tell My Customers About the New Service?
No, Amazon has no plans at this time to notify your customers that CBA will soon end. Amazon also won't notify your customers about the Pay with Amazon service.
How Long Does It Take to Integrate Pay with Amazon?
The answer is an all-too-familiar one: it depends.
If you need a sophisticated integration that requires API, it will take longer (and probably cost more) than more simplistic integration options.
On the other hand, if you're on a hosted platform, such as Shopify, then integration should be a snap because many of those e-commerce sites natively support Pay with Amazon.
Will There Be a Change to How My 1099-K Form Is Calculated?
No, the change in payment processing doesn't affect how your 1099 income is calculated.
Also, if you've agreed to receive your 1099 form electronically, you'll still receive it that way when you switch to Pay with Amazon.
Does My CBA Balance Transfer to Pay With Amazon?
No, balances don't transfer between the two accounts. Instead, your existing CBA balance will be deposited into your bank account of choice 90 days after you close out the account.
How Do I View CBA Reports After I've Switched to Pay With Amazon?
You'll still access your CBA account via Seller Central as long as it remains open. It's a great idea to download all your reports as you move away from CBA permanently so that you have hard copies of your final transactions.
How Do I View My Pay With Amazon Reports?
You'll also see your Pay with Amazon reports in Seller Central.
Can I Use the Same Email Address?
Yes, you can use the same email address to sign up for Pay with Amazon that you used to sign up for CBA.
Will I Receive a New Merchant ID?
If you use the same registration information for Pay with Amazon that you used for CBA, then your merchant ID will stay the same. Your keys for authentication will also remain the same.
What Happens to My CBA Account After I Sign up for Pay With Amazon?
You can manually close your CBA account by contacting Amazon's support team. Alternatively, you can leave your account open and it will be automatically closed later when Amazon terminates the service.
Can I Continue to Use CBA After I Sign Up With Amazon?
You're allowed to close out your outstanding CBA orders and manage refunds associated with the account. Once you've completed those orders, you're free to close the CBA account.
What's the Timeline for Chargebacks Under the Pay with Amazon Program?
You have five days to respond to A-to-z Guarantee claims and 11 days to respond to chargebacks.
Can I Still Use My Old CBA Button?
No. Amazon wants you to use the new Pay with Amazon buttons. Remember, your CBA button will no longer work after April 1, 2017.