Amazon.com will no longer accept Bill Me Later as a payment method effective December 31, 2008. Amazon made the announcement to sellers abruptly on Monday, 5 months after adding the service to its marketplace and 1 month after Bill Me Later was acquired by rival eBay for $945 million.

Amazon.com had invested in Bill Me Later (BML) last year (it reportedly held a 10 percent stake) and had launched it as a payment option on its site in July. When eBay announced it was acquiring BML in October, BML told AuctionBytes that while it could not answer for Amazon, it expected to continue to have a long relationship with Amazon.

Bill Me Later issued the following statement in response to our inquiry:

Effective December 31, 2008, Bill Me Later will no longer be offered as a payment option for Amazon.com customers. Based on the change of control of Bill Me Later, Amazon exercised their right in deciding to discontinue offering Bill Me Later as a payments option. More than 1,000 online stores, catalogs and travel partners, currently offer Bill Me Later, because our payment service offers a convenient, flexible way for millions of consumers to shop. We think Bill Me Later provided a valuable service to shoppers on Amazon.com, and we would welcome the chance to work with Amazon.com in the future.

eBay had said in October that it expected to add the BML service to the eBay marketplace and the PayPal Merchant Services platform sometime next year. BML offers transaction-based credit to online shoppers at the time of checkout. Consumers provide BML with their date of birth and last four digits of their social security number, and BML's engine decides whether to approve and extend credit for the transaction - the average authorization time is less than 3 seconds.

A spokesperson for Amazon did not respond to inquiries before press time.

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