US e-retailer Amazon has made an undisclosed equity investment in alternative payment scheme Bill Me Later and is adding the instant credit service to its online shopping sites.
The Bill Me Later service enables consumers to shop online without using a credit card. Registered users of the service can defer payment on purchases without using credit or debit cards. Instead customers receive a bill that can be paid in full without interest or fees, or go via payment plan which would involve interest.
Maryland-based Bill Me Later says its service is currently available on around 700 retail Web sites.
The terms of Amazon's investment have not been released. The transaction, which is subject to customary closing conditions, is expected to close in the first quarter of 2008. Bill Me Later says it will use the funds to continue its growth and expansion in 2008.
Matt Swann, vice president of payments at Amazon.com, says: "Bill Me Later has developed a very customer-centric method to make online shopping even easier."
A study released earlier this year by Javelin Research & Strategy predicts increasing take up "alternative payment methods", including instant credit services such as Bill Me Later which will likely see a small jump and may experience a boom with the emergence of PayPal's "Pay Later" credit account service.