Amazon Stops Processing Payments For Crowdfunding Platform For Creative Commons Books

from the weird dept

So this is a bit strange. is a cool crowdfunding platform that focuses on raising money for authors/rightsholders so that they'll release an edition of their books under a Creative Commons license. We've seen a few similar offerings, but seemed really interesting (and to be getting some attention/traction). Basically, they would work with rightsholders, to find out at what price they'd be willing to put their works out under a Creative Commons license, and then try to crowdfund that amount. Neat idea. However, as Jack Allnutt alerts us, despite having already been processing payments for, Amazon has cut the service off, with a bizarre claim about how they don't want to work with any new crowdfunding platforms:
Amazon Payments has informed us that they will no longer process pledge payments for, forcing us to suspend all active ungluing campaigns. According to a Senior Account Manager at Amazon, Amazon has decided against “boarding fresh crowdfunding accounts at this time”. Amazon has been providing payment services for, as it does for the popular crowdfunding site Kickstarter.
Of course, that statement doesn't make much sense, given that it was already processing payments for In fact, part of this news was that Amazon is requiring to void all payments for existing campaigns (i.e., those not yet funded). So the idea that this is about not "boarding fresh crowdfunding accounts" doesn't make much sense. Amazon has been the only choice for payments on Kickstarter since the beginning, and that seems to have gone well, so it's odd that they're now cutting off others (and, of course, opens up Amazon to wild conspiracy theories). I contacted Amazon to get their side of the story, and they provided the following comment:
We support a wide variety of businesses, but we have regulatory obligations as a licensed money services business for how we operate. Unfortunately,’s model is not the same as some other crowdfunding services and at this time does not allow us to meet those obligations.
That statement makes this all the more... confusing. They're clearly implying that there are regulatory issues preventing them from supporting, though I'm not sure I can think of what the concern here might be. There have been some regulatory issues around equity funding via crowdfunding, but that doesn't seem to be an issue here. If they're just working out deals for licensing books... I'm at a complete loss.

Filed Under: crowdfunding, payment processing
Companies: amazon, kickstarter,

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  1. icon
    drew (profile), 10 Aug 2012 @ 4:39am

    Re: Re: Re:

    Good shout, things have tightened up a lot in the UK (well, the laws have tightened up, the practices less so) but it's been very focussed on companies that actually take deposits rather than companies that facilitate payments.
    I wonder how much money-laundering this prevents vs how many start-ups / innovators find themselves unable to realise their idea.

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