In a surprising turn of events, Amazon has notified its users that it will cease accepting Venmo as a payment method starting January 10. This abrupt reversal comes just over a year after Amazon’s announcement in October that it would integrate Venmo into its payment options, providing customers with more flexibility at checkout.
The news was delivered to Amazon customers late Wednesday via a notice, indicating that users would no longer have the option to pay using Venmo after the specified date. However, the notice also clarified that Amazon would continue to accept Venmo debit and credit cards. Venmo itself acknowledged the change on its website, stating, “Due to recent changes, Venmo can no longer be added as a payment method,” and assured users with the service enabled in their Amazon wallets that it would remain accessible until January 10, 2024.
Shares of PayPal, the parent company of Venmo, experienced a notable dip of over 2% in afternoon trading on Thursday following the announcement. The move by Amazon, a major player in the e-commerce and technology industry, has raised eyebrows and prompted questions about the reasons behind this sudden decision.
Amazon’s decision to remove Venmo as a payment option contrasts sharply with its previous strategy. Just a little over a year ago, the e-commerce giant had proudly declared its intentions to incorporate Venmo into its payment methods, thereby expanding the array of choices available to consumers during the checkout process.
An Amazon spokesperson confirmed the change but did not provide specific details on why Venmo is being excluded as a payment method. While the abrupt shift has left users and industry observers puzzled, Amazon assured its customers that there are still “nearly a dozen other payment methods” available for their convenience.
The removal of Venmo from Amazon’s payment options will undoubtedly have repercussions, not only for Amazon users who have come to rely on the popular payment service but also for Venmo and its parent company, PayPal. As the news reverberates through the financial and tech sectors, it remains to be seen whether this move is an isolated decision or indicative of broader changes in the competitive landscape of digital payments. For now, users will need to adapt to the altered payment ecosystem on Amazon and explore the alternative methods provided by the e-commerce giant.
(Source: Barron’s | TechCrunch | CNBC)
