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Social networks, mobile operators and online retailers now have new payment options to offer customers, thanks to new products by PayPal and Amazon.

PayPal, whose dominance in the online payments space has been threatened by both Amazon and Google, just launched a platform - PayPal X - that lets third-party developers incorporate its online payment system into their own applications. It includes a software development toolkit, technical documentation and API support tools, along with pre-existing products that can create instant storefronts for Facebook via Payvment's social networking shopping cart system, and applications that can be embedded in mobile applications, including via ShopSavvy's comparative shopping Android app. The mobile SDK will initially support iPhone.

PayPal X's 'enhanced' pricing structure - a 50-cent flat-fee price point for a three-day settlement, and a 75-cent fee for an immediate settlement - is a direct shot at Amazon.

For its part, Amazon introduced a service last week called PayPhrase that enables consumers to type in a phrase - instead of entering a credit-card number - to pay for their purchases on Amazon.com and partner websites. The consumer-selected phrase is used in conjunction with a pre-established PIN.

The service will be available to all websites that accept Checkout by Amazon including DKNY, Jockey, Patagonia, Buy.com, J&R Electronics and Car Toys.

The Need for Alternatives

As consumers become increasingly concerned about using credit cards for online, purchases, alternative payment mechanisms are becoming almost as important to online retailers as shopping carts that discourage abandonment.
Last year payment service provider Bill Me Later’s network of online stores, catalogs, and travel partners hit - and surpassed - the 1,000 merchant mark, in part because of such demand, writes RetailerDaily.

Bill Me Later uses speedy credit approval to vet customers in seconds, based on identifying information such as birth date and partial Social Security number.

Approved customers receive a bill in the mail and can pay in full, or over time with interest.

A Media Play

More recently, news was leaked that Google is planning to unveil a micropayment system aimed at the media industry. The micropayment system - set to launch within the next year - will be an extension of Google Checkout, a competitor to PayPal with the ability to allow payments ranging from one penny to several dollars by aggregating purchases across merchants and over time.