Evan Schuman's StorefrontBacktalk

A new deal between Amazon and Western Union—where consumers can give cash to Western Union and have it instantly turned into an online gift certificate—has the potential to truly test how concerned consumers are about data fraud today.

On the one hand, the deal would initially seem to make little sense for Amazon, as it takes away much of the spontaneity, speed and convenience of an online brand. Even worse, a consumer walking into one of Western Union’s 44,000 U.S. locations has to pay a fee above and beyond the value of the giftcard, albeit a minor fee. A $500 giftcard, for example, has a $3.95 charge, while a $2,600 card will cost $7.95 and a $250 card will cost $2.95.

But this program isn’t about saving money or boosting convenience. The only way this makes sense is giving the program credit for being the only way to make online purchases that are—in theory—absolutely safe. If Amazon, Amazon’s card processor or Western Union is breached, there’s no private financial data exposed. If any of those businesses has a glitch and tries to overcharge the consumer—as recently happened to both Macy’s and Best Buy— the consumer is completely safe as there exists no more money to access.

This might also have appeal to consumers who, in today’s economic meltdown, either don’t want to or can’t get credit and want to avoid the extreme risks of debit cards.

“In today’s economy, consumers are being more thoughtful about their use of credit,” said David Shapiro, senior vice president, Western Union Payment Services. “Western Union is ensuring that those who prefer to pay in cash have the ability to do so.” How sweet and thoughtful. It’s always nice to see a vendor turning a product pitch into something sounding altruistic.

Will this program succeed? Let’s put aside the literal definitions of success here, where it might not take much to overcome this program’s modest costs to turn a profit. But will it be successful in a dramatic way? Based on repeated surveys that show consumers panicking at data breach reports, one might think so. If one did, one would be wrong.

In an economic downturn, consumers are obsessed with lowest cost and efficiency in purchases. Regardless of how much consumers talk about data breach fears, it simply is not likely to overcome the hesitation to drive to Western Union every time sometime feels like making an Amazon purchase. Please don’t get me wrong. Consumers absolutely do want more secure transactions. They simply don’t want them nearly that much.