Online shoppers can choose a customized phrase -- such as Knick Knack, Home Sweet Home, or Jake's Allowance -- and then enter that phrase along with a PIN to quickly preview an order and complete a purchase. PayPhrase uses the preferred payment and shipping methods stored at Amazon.com and consumers don't have to share sensitive payment information with multiple web sites.

"PayPhrase solves the headache of trying to keep track of all the different usernames and passwords people use to shop on various sites across the web. With PayPhrase, all you need is one phrase and one PIN to pay online," said Matt Williams, general manager of Amazon PayPhrase. "We think customers will enjoy the simplicity that Amazon PayPhrase offers, and we hope they'll have some fun choosing their own personal phrases."

A Practical Payment Solution

Amazon.com customers can use their PayPhrase for express checkout wherever they see the PayPhrase button. For example, web sites accepting Checkout by Amazon, including DKNY, Jockey, Patagonia, Buy.com, J&R Electronics, and Car Toys, will offer PayPhrase as a checkout option. With these and other participating web sites, customers don't need to register or create a new account to make a purchase.

Practically speaking, customers shop for the item they want, type their PayPhrase into the PayPhrase button on the product's page, and click to preview the total cost of their order, complete with shipping and tax. The PayPhrase system eliminates the need to go through steps such as "add to cart," "proceed to checkout," sign in, or type in credit-card information. Once the customer is satisfied with an order, he or she can enter a PIN to complete the order.

Amazon is pointing to benefits for online retailers that tap into PayPhrase. By offering the new service, Amazon said, merchants can benefit from the familiar Amazon.com checkout experience.

The PayPhrase Advantage

Amazon's PayPhrase is a significant development because online shopping has been a fairly cumbersome process that requires entering credit-card and shipping information, said Phil Leigh, a senior analyst at Inside Digital Media. He said PayPhrase simplifies the process securely.

What's different about PayPhrase, Leigh explained, is that it integrates with credit cards, which most online shoppers still prefer. Unlike PayPal, he said, consumers don't have to worry about whether there is enough money in their account to cover the charges and how long a delay there will be before the merchandise ships when funds clear.

"This is an advance in the way that we purchase merchandise online. This will be significant, particularly around Christmastime as people get rushed," Leigh said. "Secondly, this is not only an advantage to the consumer, but it's a way that Amazon can make money by offering a payment service that other web sites can use."