Apple Inc. (NASDAQ:AAPL) launched Apply Pay on the 16th of October with the hopes to change the way consumers carry out their transactions; however the company ran into a few issues when some retailers joined forces and discontinued using Apple Pay for an alternate payment method and showed their disinterest in Apple’s payment technology.
Apple Pay has been made available on iPhone 6 and 6 Plus, the upcoming iWatch, iPad Air 2 and iPad Mini 3. Apple Pay does not require contactless payment terminal that are Apple specific; consumers can use Apple Pay through PayPass (MasterCard), PayWave (Visa), ExpressPay (American Express) terminals.
Analysts and experts had mixed views about the probability of the success of Apple’s digital wallet. The main reason for their skepticism was the failure of Google Wallet, which did not get the response from consumers it had hoped for.
Despite these setbacks, it seems, Apple Pay is now getting the kind of response Apple was hoping for. Many retailers have adopted the technology and give their shoppers an easier method of paying for their purchases. Since its launch until November’s end, Apple Pay accounted for 1.7% of all mobile payments. On the other hand its competitor Google Wallet accounted for only 4% of mobile payments during the same time period.
A research carried out by ITG has reported that Apple Pay is most popular at McDonald’s, Whole Foods and Walgreens – the top three retailers that use Apple Pay. Other retailers that made into the top five list are Subway and Panera. According to research 20% of the total transactions made through Apple Pay were done at Whole Foods in the month of November; whereas in terms of dollars spent Whole Foods was responsible for 28%. Walgreens came in second place by being responsible for 19% of the total transactions made using Apple Pay with 11% in terms of dollars spent. McDonald’s came in third place and was responsible for 11% of the total Apple Pay transactions with 3% dollars spent.
These are still very early days for Apply Pay, which faces stiff completion from its rival and market veteran PayPal, which at the moment is the leader in mobile payments and accounted for 78% of the total market share in November. However things look good for the tech giant’s payment method because from here on it can only get bigger. It is believed that Apple Pay will become more widely used once Apple Watch makes its debut in the market.
Apple is not restricting itself to just retailers; the company hopes to collaborate with banks as well. The tech giant claims that Apple Pay supports 90% of the total purchase volume of credit cards within the US.
The best feature about Apple Pay, the one which will make it a huge success, is its security, which allows consumers to keep their important information hidden from retailers. The payment method works using digital “tokens” that lets you carry out transactions without feeding your account number or other details into retailer’s database.
It is believed that soon Apple Pay will also be made available in the UK and other parts of Europe, Middle East, Africa and India.
