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Amazon has informed PayPal that it will discontinue its use of Venmo as a payment service for purchases, only a year after adding the option.
Amazon pulls the plug on Venmo
Amazon said it will no longer let users pay using Venmo beginning January 10th 2024, according to a notice sent out to its customers.
Amazon will still accept Venmo debit and credit cards, the notice states. Venmo announced the move in a separate notice posted to its website.
“Due to recent changes, Venmo can no longer be added as a payment method,” the company said. “Venmo will remain available to users who currently have it enabled in their Amazon wallet until 01/10/24.”
PayPal and Amazon rolled out the partnership in October 2022, “with PayPal hoping to monetize Venmo more effectively, and Amazon looking for exposure to a new, younger customer base,” said David Togut, an analyst at Evercore Inc.
“We expect this news is simply the result of a lack of traction, as consumers failed to adopt using Pay with Venmo as their preferred checkout method.”
PayPal, like many of its rivals in e-commerce, has been dealing with a slowdown on some of its platforms as consumers return to in-store shopping and slow spending because of inflation.
The company is overhauling its senior ranks under new Chief Executive Officer Alex Chriss, creating 3 new business units focused on consumers, small businesses and large enterprises.
PayPal shares slipped 1.8% to $58.46, ranking it among the day’s five worst performers in the S&P 500 Financials Index. They have declined 18% this year, compared with a 4.3% increase for the S&P 500 Financials Index.
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