Amazon battles Walmart

The competition is different than you might expect, folks. There is a strong focus on finance, in addition to ecommerce.

The dominant US ecommerce company [Amazon] has been dabbling in lending for nearly six years, and has made $3bn in loans to some of the small businesses that sell through its online platform.

Now Amazon is substantially expanding its offer of instant loans and considering whether to provide other bank-like services. ….

The Seattle-based juggernaut also this week stepped up its battle with the world’s largest retailer, Walmart. Targeting the lower income customers that have long been Walmart’s bread and butter, Amazon said it would offer substantial discounts on its Prime membership programme to US shoppers who are on public assistance. ….

Over the short term, both initiatives sound like great news for consumers and small businesses. Amazon’s move into banking has already created new borrowing opportunities for businesses that had struggled to get bank loans. And its offer to low-income customers will give them more equal access to the benefits of the digital economy.

Brooke Masters, “Amazon’s quiet domination merits greater scrutiny“, Financial Times, 10 June 2017 (gated paywall).

Walmart Financial Services provides credit cards and other bank-like services, including cash transfers to Mexico and other countries, in addition to transfers within the United States and Canada.

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