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Amazon takes on Square, PayPal with new credit card reader

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Amazon is making a play in small-business payment processing by launching Local Register, a credit card reader that can be attached to a smartphone or tablet.

The Seattle-based online retailer announced the $10 device Wednesday, challenging established players in the market, including Square and PayPal. Businesses that purchase Local Register and sign up for an account before Oct. 31 will pay a 1.75% fee for each payment processed until Jan. 1, 2016. Businesses that sign up after Oct. 31 will pay the standard 2.4% rate.

By comparison, Square grabs 2.75% of each payment while PayPal Here takes 2.7%. Another player in the market, Intuit’s GoPayment, takes 2.4% of each payment, or 1.75% for businesses that also pay $19.95 per month.

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“We understand that every penny and every minute counts, so we want to make accepting payments so easy and inexpensive that it no longer gets in the way of a business owner doing what they love -- serving their customers and growing their business,” Matt Swann, vice president of Amazon local commerce, said in a statement.

The launch of Local Register appears to have pleased investors. Amazon’s shares rose 3.6% in morning trading on Wall Street, a sharp contrast from the company’s stock performance so far in 2014 -- down more than 15% since the start of the year.

To the disappointment of shareholders, Amazon has focused on introducing new products and services rather than increasing profits. The company posted a net loss of $126 million in its most recent quarter.

Amazon this year has also introduced the Fire TV, a video-streaming player, and the Fire Phone, its first smartphone.

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