Adobe announced it will add payment services to its e-commerce platform this year to help merchants accept credit cards and other ways of paying.
Adobe started providing software to help retailers run their online stores in 2018 when it purchased Magento Commerce from private equity firm Permira for $1.68 billion.
Adobe will be tapping PayPal to process a variety of payment types, including credit and debit cards as well as PayPal’s own payment and pay-later offerings. Peter Sheldon, senior director of commerce strategy at Adobe, told Reuters that the processing deal with PayPal is not exclusive, and as Adobe expands further internationally after 2022, it may work with other processors.
Payment Services will be available to merchants in the U.S. in the fourth quarter of 2021. The feature will also be accessible to merchants using Magento Open Source.
Support for additional territories, including Canada, Australia, and Western Europe, are planned for 2022, Adobe said.
Until now, Adobe’s e-commerce customers have had to build their own payment systems. That works for larger businesses that can negotiate with payment processors, but Adobe wanted a simpler service for smaller merchants.
Adobe Commerce is the industry’s leading end-to-end commerce application for B2B, D2C and hybrid use cases. By integrating Payment Services to their digital storefronts, Adobe merchants will have access to an integrated payment solution that can be managed from their Adobe Commerce Admin, instead of integrating with third-party payment providers.
Jordan Jewell, research director, digital commerce at IDC. “With payment capabilities now in its product portfolio, Adobe is better-positioned to support its merchants as a platform provider that can streamline commerce operations across the customer journey.”
The development will be deepening a rivalry with e-commerce firm Shopify, Reuters reported.
Payments are a big part of the e-commerce business. In 2020, more than two-thirds of Shopify’s $2.93 billion in revenue came from its merchant services segment that includes payments.
For Adobe, the payments move follows a partnership with FedEx earlier this year that helps Adobe merchants manage shipping and logistics services.
Adobe’s move on Wednesday is similar to Shopify in some ways, but it’s also just trying to monetize different portions of what a seller needs to do to sell online,” Jordan Jewell, research director for digital commerce at IDC, said.