At a time when Government is seeking to curb how much foreign exchange Barbadians spend and is about to apply a second tax for their online purchases, a global money-mover is offering a Barbados-dollar payment system at their most popular online store.
Western Union, the cross-border, cross-currency payment service today unveiled a new payment option that allows Amazon.com customers in Barbados to pay in local currency and in cash rather than by credit card.
In a joint release today, the Western Union and Amazon have dubbed the new cross-border payment option Amazon PayCode.
This method bypasses the process that involves foreign exchange, settlement and money movement requirements for international e-commerce transactions, the statement said.
Barbados is the most recent country to adopt Amazon PayCode since it was rolled out last year in ten countries – Chile, Colombia, Hong Kong, Indonesia, Kenya, Malaysia, Peru, Philippines, Taiwan and Thailand.
Under the new payment option, buyers making their purchases on the online giant’s website and mobile app will be sent a code, along with instructions on how to pay in person at a participating Western Union agent.
The move by Western Union and Amazon provides greater access to online goods for customers who have largely been excluded from e-commerce shopping due to lack of accepted payment methods, the statement said.
Forrester Research estimates that cross-border shopping will represent 20 per cent of e-commerce by 2022, with sales reaching some $630 billion.
Choice, quality and cost are the main motivations for customers to shop online from overseas, but there have been challenges and concerns about the lack of payment options for those who prefer to pay in person or those who do not have access to international credit cards or debit cards.
Senior Vice President and General Manager of Western Union Digital Khalid Fellahi insisted that the move was about expanding customer access and closing the payments gap.
Fellahi said: “We’re helping to unlock access to Amazon.com for customers who need and want items that can only be found online in many parts of the world.
“This is a great example of two global brands innovating and collaborating to bring customers more convenience and choice. In a world where cross-border buyers and sellers are often located on different continents and in completely different financial ecosystems, Western Union’s platform is ideally suited to solving the complexity of collecting local currency and converting it into whatever currency merchants need on the other end.”
Director of Payment Acceptance and Experience at Amazon, Ben Volk, said: “Amazon PayCode leverages the reach of Western Union to make cross-border online shopping a reliable and convenient experience for customers who do not have access to international credit cards or prefer to pay in cash.”
The release made no mention of whether the shipping costs would be adjusted, but pointed customers to the companies’ websites for more information on payment options and the PayCode.
The move comes as Barbadians get ready to start paying a 17.5 Value Added Tax (VAT) on online purchases come May 1. Since September 2017, payments to overseas vendors by credit card have attracted a foreign exchange transaction tax of 2%.
The joint statement made no mention of whether the new online tax or the foreign exchange tax would be reflected on the receipt at the time of checkout or when the goods reach here if a local shipping address is used.