Amazon Local Register Review

Amazon Local Register advertises that it charges only two rates: 2.5% for swiped payments and 2.99% for keyed-in payments. These rates are significantly lower than those offered by Amazon’s primary competitors, Square and PayPal Here. Amazon Local Register also advertises no monthly fees, no long-term contracts, no chargeback fees, no refund fees, and no additional fees for international cards. Amazon’s card reader costs $10 and does not appear to be reimbursed via account credit at this time.

At first glance, this pricing appears to be highly competitive and ideal for most small retailers. However, it is worth noting that Amazon has a similar policy to other mobile processors regarding cash reserves and fund holds. Merchants should be sure to read two sections of the company’s user agreement in particular:

We may require that you maintain a minimum balance in your Payment Account or establish a separate reserve account Reserve to secure the performance of your payment obligations under this Agreement. The Reserve will be in an amount we determine to cover our risk from providing the Services to you (including without limitation anticipated Chargebacks or credit risk) or the amount designated by our Processor. The Reserve may be raised, lowered or removed from time to time. You agree that we may fund the Reserve from your Balance, funds sent by you upon our request, or funds due to you under this Agreement. You grant us a security interest in and lien on all funds held in any Reserve, and you also authorize us to make any withdrawals or debits from the Reserve, without prior notice to you, to collect amounts that you owe us, our Affiliates, your customers or Other Users.

Your Payment Account may be subject to certain limits, which may affect your ability to send, receive, or withdraw funds. Any limits may be modified at any time. These limits may be affected by several factors, including without limitation our assessment of the risk associated with your Payment Account, the amount of pending or potential Chargebacks, the information you provide, our ability to verify your account information, and requirements of law. In addition to account limits, we may restrict transactions to or from your Payment Account or limit access to funds in your Payment Account in an amount and for a period of time we deem necessary to protect us, your customers, or Other Users including without limitation if: (a) we are subject to financial risk, (b) you have violated any term of this Agreement, (c) you have pending Chargebacks or we believe you may have Chargebacks, (d) any dispute exists involving your Payment Account or transaction conducted in connection with your Payment Account, (e) needed to protect the security of our systems, or (f) required by law or court order or if otherwise requested by law enforcement or any governmental entity. We may inspect your Payment Account for any reason.

We have found a handful of Amazon Local Register complaints that specifically mention account freezes or withheld funds. At least one of these merchants charged a very high amount on a keyed-in transaction immediately after opening the account, which is a behavior that is likely to result in a hold. Given the low number of complaints about this issue, we will award Amazon Local Register an “A-” rating in this category for the time being.