Amazon Payments starts handling mobile phone bills just in time for its own mobile phone

Amazon(s amzn) is launching a new consumer payments option on Monday that will allow businesses that rely on subscription fees to process their monthly bills through the e-commerce giant.

Reuters first reported on the new program on Monday, but Amazon confirmed the details with me this morning. Companies ranging from music streaming to magazines would be able to tap the new “pay with Amazon” billing option, as well as mobile carriers.

That last option is significant because Amazon looks ready to launch its long-awaited smartphone next week. While Amazon may not become a mobile carrier itself, this service could let customers pay for both their Amazon Appstore purchases and their monthly mobile subscriptions with their Amazon credentials.

Source: Amazon

Source: Amazon

Amazon is already working with one carrier, mobile virtual network operator Ting, to process its customers’ monthly payments if they opt to use the service. The PeachDish, which ships you the ingredients for a gourmet meal each week, is now using Amazon as its sole payments source.

Amazon launched Login and Pay last fall, launching a direct shot over PayPal’s(e bay) bow. Rather than only process its own payments and those of its hosted store partners, Login allowed any merchant to put a “pay with Amazon” button on its checkout page. Amazon already has the payment information for millions consumers stored online, and additionally it is able to lend its known brand to small unknown e-commerce ventures consumers might not yet trust.

Until today, however, Login and pay only supported one-time purchases. According to Amazon, this update will let businesses use Amazon to process recurring payments for varying amounts — exactly what’s needed to support a subscription-based service. Customers will be able to track their different subscriptions through their Amazon accounts, set up new payment relationships with new businesses in a few online steps and configure particular accounts for automatic billing to your card on file, Amazon said.

This could be one of many steps Amazon takes into the financial services. In January the Wall Street Journal reported Amazon is testing an in-store payments service that could compete against Square’s point-of-sale system as well as mobile wallets offered by Google and Isis.

As a payment processor, Amazon might actually be welcomed by consumers. A recent survey conducted by Accenture found that 37 percent of the younger consumers in North America would welcome Amazon as their primary banker.

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