A popular term in finance tech circles is ‘the unbanked’ — those without a bank account, whether they be low-income people or younger people who seem to get by fine only using services like PayPal (which itself has become something of a bank). It’s been tabbed as a huge growth market for anyone in the financial services game, and that’s not lost on Amazon. Their new service, Amazon Cash, is reaching out to the unbanked with a new cash-friendly service that gets around the risks and drawbacks of gift cards.
Anyone with an Amazon account can now get in on Amazon Cash, which allows users to add value to an Amazon account using cash. Using the service will generate a unique barcode on the Amazon app (this barcode can be printed from a computer, as well), which can be scanned at participating retail stores. Once the barcode is scanned, cash can be handed over (up to $500), which will immediately be added to the Amazon account associated with the barcode.
While Amazon Cash is accessed using Amazon’s existing gift card system, there are some key differences from a gift card. The main one is that there’s no worrying about the inconvenience of losing a card — the money is simply tied to the account. While Amazon gift cards don’t expire, there’s also the minor annoyance of having a handful of cents left on a card. With Amazon Cash, that doesn’t need to be managed.
For Amazon, it’s a way to access a whole new market of people who still primarily use cash for transactions. It makes sense for the participating retailers, too — for the most part, that list is made up of the drugstores, grocery stores, and gas station markets that usually carry gift cards in bulk, and don’t have much to fear from Amazon’s retail domination. At launch, Amazon will be working with CVS, Speedway, Sheetz, Kum & Go, D&W Fresh Market, Family Fare Supermarkets, and VG’s Grocery.