Amazon capitalizing on the growing contactless payment adoption with the launch of touchless palm-reading payment system

Print

Email

Demand for contactless payments has surged due to the increasing concern of consumers around hygiene best practices amidst the Covid-19 best practices. Mobile payment providers particularly in the North American and European markets are introducing new touch-free payment options. Both markets, with cards as the most preferred payment method, are now primary target for mobile wallet giants for market expansion.

Companies are clinching on the opportunity to introduce the new user base to the contactless payment methods such as NFC and QR code offered through mobile wallets. US payment giants such as PayPal and Apple Pay have enhanced their contactless payments offerings. Alipay, the Chinese e-wallet giant, also partnered with local players in Europe to expand its market to the continent.  

The convenience and sanitary best practices presented by these payment methods are expected to boost the preference for contactless payment methods even post pandemic. Covid-19 is forcing consumers to switch from use of card and cash, has accelerated the demand for contactless payment. The opportunity for market players for growth in the niche markets such as North America and Europe where the credit and debit card dominate the payments market is immense.

According to PayNXT360’s Q4 2020 Global Payment Survey, spend on contactless payment systems both by merchants and technology players is expected to increase over the next eight quarters. This is supported by an increasing number of consumers trying out contactless payments for the first time during COVID-19.

Amazon announced, in February 2021, the unveiling of contactless payment and identity system technology using palm at its physical retail stores. With this launch, the company intends to exploit the growing adoption of contactless payment systems especially during the pandemic. In November 2020, the company launched Amazon One, a biometric device which uses computer vision technology to develop a unique palm signature and allows shoppers to pay Amazon Go stores.

The customers need to sign up using credit card and hover their palm over an Amazon One device to register for using this service. Once the card and palm signature is registered, customers can enter the store by just hovering their palm above Amazon One device to make payments. This contactless payment option is already available at a few Amazon Go cashierless stores, Amazon bookstore and an Amazon 4-star location in Seattle. Further, Amazon plans to provide the new palm-reading technology to other retailers, stadiums and office buildings.

Apart from this palm-reading contactless payment option, Amazon offers Amazon Pay technology which allows customers to use their credentials to make purchase on their websites. In 2020, Amazon launched Just Walk Out technology, which allows retailers to operate stores without cashiers.

Amazon with the launch of its touchless technology is competing in the crowded contactless payment market where competitors such as Apple Pay and Google Pay have gained strong foothold in the contactless payment market. Other players operating in the market include Walmart, and Samsung.

Though biometric payment methods are becoming widely accessible which could help Amazon expand its technology, the e-tailer could face merchant acceptance challenges.