There may be as many as 50 million Americans that can subscribe to the Amazon Prime service at a discounted price. The online retailer is offering savings to low income households as well as people living in poverty provided they receive some form of government assistance and also use a Electronic Benefits Transfer Card (EBT).
This means that those millions of families that receive some form of benefits from programs including TANF – Temporary Assistance for Needy Families (TANF); cash assistance from welfare; SNAP food stamps Supplemental Nutrition Assistance Program; or the Women, Infants, and Children Nutrition Program (WIC) will be able to benefit from this new Amazon program. Even if a household is not currently on public assistance, and if they go onto a benefit at some later date, they will be able to enroll at some future date.
Amazon has now added Medicaid recipients to this discounted Prime service. They will be able to subscribe for $5.99 per month. This is less than half of what the standard monthly retail price is. In addition, with Amazon looking more and more at health care, Medicaid recipients may soon be able to buy OTC prescriptions and other health care products they need.
The savings will be substantial. This deal will save a family as much as $70 per year. While on the surface that may not sound like much money, it is equivalent to about 50% off the regular retail price. And of course a low income household will also benefit from all of the other benefits to using Prime…such as free shipping, video, TV on demand shows and music streaming services, the Prime Pantry to shop for groceries, and much more. The number of services Amazon offers now is incredible, and you can all but guarantee that Prime will continue to grow and add other components to it.
Amazon is also hoping that the low income customers who are on Medicaid, SNAP Food Stamps or another government benefit stick with the Prime service if and/when their income increases. In other words, they are hoping to build out a more loyal customer base for future online shopping.
More competition coming?
We think this is a major announcement from Amazon. Maybe the biggest reason is that it is bound to make the retail environment even more competitive. This should result in even more savings for low income families, whether they are on SNAP food stamps or some other benefit or not. For example, we would fully expect Wal-Mart to step up to the plate and soon offer more savings for people that use their online services. Other online retailers are bound to do the same. For those who want to explore additional savings, find online deals
Then of course if retailers such as Wal-Mart respond to the new pricing for the Amazon Prime service, it will more than likely feed on itself. This means Amazon may offer even more discounts, leading to more responses from companies. It is a cycle that should continue to drive down prices for low income families. So the savings can add up.
One risk to all of this competition is that services such as Amazon Prime often “encourage” people to spend more and more money online. This is mostly due to their simplicity. It is so quick and simple to order items, whether it is food or electronics or any of the millions of other products, that it leads to “consumerism”.
For a low income family living on government assistance, the risk is even higher. Maybe instead of relying on TANF cash assistance for buying their core goods, since Prime is so simple to use it may be tempting for the household to spend extra money on “wants” and not “needs”. This in dangerous for those living on benefits or paycheck to paycheck.
However, if you partly rely on public assistance such as SNAP food stamps or WIC, and if you shop smartly, saving ~$70 per year sure does sound nice. So we do recommend that those disciplined shoppers explore this Amazon Prime discount program.