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Report: Rite Aid disables Apple Pay support
Rite Aid has reportedly disabled support for Apple Pay according to a report published today in MacRumors. Though the NFC terminals at Rite Aid stores are technically compatible with Apple Pay, it appears that steps are being taken to specifically prevent what would be otherwise valid transactions. Naturally, some Apple Pay users are frustrated at this surprising turn of events given that Apple Pay transactions worked well at Rite Aid earlier in the week. Josh Hudnall is one such user who recounted his failed attempt to use Apple Pay at Rite Aid. Today, Allison asked me to pick up a few things on my way home from the office, and I'm a major nerd, so naturally I was all too happy to oblige. I was equally disappointed, then, when my transaction was declined with a message on the terminal informing me that Apple Pay was not supported. The terminal mentioned Apple Pay by name. So the system is smart enough to know about Apple Pay and to decide not to take it. What's more, Hudnall relays that the cashier informed him that the store had received an email earlier that day indicating that they will not be supporting Apple Pay. So what's going on here? Some old fashioned and completely misguided competition, that's what. You see, Rite Aid is part of a consortium of retailers who are throwing their support behind an upcoming mobile payments platform called CurrentC which was developed by a company called Merchant Customer Exchange (MCX). MCX's goal is to be a universal mobile payment platform and enjoys support from a number of top tier retailers, including Walmart, Best Buy, Bed Bath & Beyond, Sears, CVS, 7-Eleven, GAP, Wendys and more. So if you've been wondering why some retailers haven't been quick to support Apple Pay, look no further than MCX. Now you might be wondering: "Why can't retailers support both mobile payment platforms and let consumers decide with their wallets?" As it turns out, MCX's policy is such that its members cannot accept payment from other mobile wallets. Notably, CurrentC doesn't operate via NFC. As a result, retailers on the CurrentC bandwagon can prevent Apple Pay transactions simply by turning off NFC functionality on otherwise modern POS machines. As a final point, it's also worth noting that CurrentC isn't even scheduled to go live until 2015.
First Apple Pay ad (from MasterCard) aired during yesterday's World Series game
The first nation-wide advertisement (or perhaps mention is more appropriate) for Apple Pay hit the airwaves yesterday during game one of the World Series. The ad was a MasterCard production, with a narrator stating that Apple Pay users are eligible for MasterCard's ongoing "Priceless Surprises" sweepstakes. I managed to record the ad, albeit with some questionable sound quality. That MasterCard would mention Apple Pay during a commercial break isn't all that surprising. Yesterday we relayed that MasterCard helped roll out Apple Pay enabled NFC terminals to food and concession stands at both stadiums involved in the World Series. The larger takeaway here is that Apple Pay hasn't even been out for a full week and we've already seen it in a commercial, during the World Series no less. As we've mentioned before, Apple Pay is in a unique position to succeed because it enjoys unprecedented support from both banks and credit card companies. The degree to which these financial institutions have been promoting Apple Pay (on Twitter, via email, on their own websites) is unprecedented compared to what we've seen for previous mobile payment platforms.
Apple Pay works in overseas (if you pretend you're in America)
Beau Giles is a web developer and blogger based out of Sydney, Australia who wanted to know if he'd be able to use the new Apple Pay system in his home country's NFC payment points. After a little bit of expiring he discovered that Apple Pay does indeed work in Australia, but only if he tells his phone he's in America. Unless your phone is set to the United States region Apple Pay is hidden from the setting of your device. Of course this can be easily fixed by just changing your settings, so it isn't a big deal. However, finding a card that works with the service might be. Cards that are issued outside of the USA won't work with the service, so you will need one of the cards that's officially supported by Apple Pay. That can make things expensive; as Americans who have traveled abroad already know using your U.S. credit card in another country usually means paying an expensive currency conversion fee. There's currently no timeline for Apple launching Apple Pay in other parts of the world, as complicated deals must first be reached with banks and financial institutions in those countries. Still the drive to try new technology will lead some users to giving this method a shot. Just be prepared to pay extra for the experience. Editor's Addition: Keaton Keller (@keaton on Twitter) has produced a short video showing exactly how to set up your device using Beau Giles' method. Enjoy!
MLB is bringing Apple Pay to the 2014 World Series
Tonight, Kansas City Royals and San Francisco Giants will begin battling it out for Major League Baseball's biggest prize: the World Series. And to make things better for ballpark attendees, MLB and MasterCard have announced that Kauffman Stadium (Royals) and AT&T Park (Giants) are going to support Apple Pay and other NFC-based payments throughout the series and beyond. Given how MLB usually adopts new technologies quickly, this shouldn't come as a surprise -- both stadiums are the first in sports to do this, and chances are the league will bring the feature to more places soon. While MasterCard and MLB are touting Apple Pay, the Cupertino company's recently launched payment system for iPhone 6 and iPhone 6 Plus, services like Google Wallet also work with the newly implemented terminals. Don't worry, we know Google Wallet has been a thing for a while.
MLB announces that Apple Pay will work at both World Series stadiums
Major League Baseball in recent years has been particularly receptive to new technologies, as evidenced by its forward thinking MLB.com At Bat app and its early support of digital ticketing via Apple's Passbook app. So with the World Series starting today, it's no surprise that the two ballparks involved -- Kauffman Stadium in KC and AT&T Park in San Francisco -- will be the first two major league stadiums to offer support for Apple Pay. Forbes reports: Just in time for the World Series on Tuesday, MLB Advanced Media, the digital media company of Major League Baseball announced on Monday that MasterCard is bringing contactless acceptance to ballpark food and beverage concessions, enabling fans to make payments using a variety of NFC-enabled devices and services, including the newly introduced Apple Pay. The report adds that MLB is also planning to roll out in-app support for Apple Pay next season, thereby allowing fans to purchase tickets directly from their iOS device. Notably, MLB Advanced CEO Bob Bowman said back in September that Apple Pay is poised to be much bigger than analysts realize and that fans will soon need to bring nothing to the ballpark except their smartphone.
Checking out in 44 seconds at Walgreens with Apple Pay
How fast is using Apple Pay? Walgreens has released a video showing how the service works at their stores, specifically at the pharmacy. In total the transaction takes 44 seconds, and that's with the confirmations that come along with entering a rewards account number. Without the rewards number the process would have taken about 20 seconds. Obviously this is an optimized example of the purchasing experience, but if you've wondered what Apple Pay will look like in real life here's a solid example. Enjoy.
Discover says it's "in discussions with Apple" to bring Discover cards to Apple Pay
Apple Pay is now out in the wild and the early reviews have thus far been positive, with the entire process working as seamlessly as Apple's demo video indicated. As it stands now, Apple Pay currently works with MasterCard, Visa, and American Express credit cards. And conspicuously missing from that lineup is Discover Card. But no need to fret Discover card users. Discover earlier today indicated via Twitter that they're engaged in discussions with Apple to join the Apple Pay mix. @bledsoe812 Hi! We are in discussions with Apple to add Discover cards to Apple Pay in the future. Hoping it will be soon! *Kirsten - Discover (@Discover) October 20, 2014
A simple guide to setting up Apple pay
Monday October 20 is the first day Apple Pay will be available to use at select retailers across the U.S., but will you be ready to bust out your phone and make a purchase? Here's a handy walkthrough for making sure you're ready when you hit the register. Step 1: Own a new iOS device Sorry, but Apple Pay is only available on Apple's newest devices, meaning you'll need to have an iPhone 6 or 6 Plus to use the service in stores. The latest iPhone comes with a Near Field Communication (NFC) antenna, which allows them to communicate with the payment interface in stores. Users with an iPad Air 2 or iPad Mini 3 can use Apple Pay to make purchases online, but they'll be out of luck when they hit their local Walgreens. Hopefully the next generation of iPads will get the NFC upgrade. Of course Apple Pay is more than just NFC, otherwise every iOS user would be able to make payments online. These newer devices feature Apple's Secure Element chip which stores your private financial data and encrypts it for your protection. Older iPads lack this chip which is why you can't currently use the service with them. Step 2: Update iOS to version 8.1 Make sure you're device is updated. Go to Settings --> General --> Software Update to make sure you're using version 8.1. The update also brings back Camera Roll to your device so it's like getting two gifts at once. Step 3: Open up Passbook and set up the right card You'll need Passbook for Apple Pay. If you've never used Passbook, don't fret. The app is still on your phone. You may have previously moved it into a sub-folder marked "productivity" or something along those lines, but it is there. When you open the app it will ask you if you would like to use the card you already have on file for iTunes purchases or if you want to use a new card. Of course there's a hitch. Apple Pay only works with Visa and Mastercard from certain banks, plus American Express, so if the card you have on file isn't with one of those services you'll need to input another card. Currently Apple pay works with cards issued by Bank of America, Capital One, Chase, City, and Wells Fargo. Barclays, Navy Federal Credit Union, PNC, USAA, and US Bank will be added in the near future. When you enter a new card into the system Apple Pay will ask you to take a picture of the card within the app. Apple cross references the card with your bank to make sure it really is your card, but don't worry. When the card is displayed on your device the card number won't show up. The reason Apple doesn't display your card number is simple; Apple doesn't actually store your credit card number. Apple Pay purchases are made using a device specific account number which is stored on your devices Secure Element chip. When you buy something with Apple Pay, Apple sends your bank an encrypted one-time use payment number and security code to make the purchases. Apple won't be able to track what you buy or where you buy it, and cashiers won't see your name or credit card number when you make purchases anymore. Step 4: Go buy something Once you've set up your card you're ready to go. Apple Pay isn't available across the board, but it's available at a number of leading retailers. At launch Bloomingdales, DuaneReade, Macy's, McDonalds, Staples, Subway, Walgreens, and Whole Foods are all accepting payments via the service. To make a payment simply wave your phone in front of the NFC terminal at checkout, swipe your finger over your iOS device's TouchID sensor, and bask in the joy of trying something new. If you're on an iPad shopping is a little more complicated. At the moment you'll need to download each company's Apple app to make purchases with Apple Pay. Given this is the service's launch day the process is remarkably easy. If you make any purchases today using Apple Pay let use know about your experience in the comments below.
Apple releases iOS 8.1 with Apple Pay support, expanded Continuity features
Apple today released iOS 8.1, bringing the version out of beta and making it available to the public. As announced last week, the latest version of iOS brings Apple Pay to supported devices and adds Photo Library access to iCloud. It also enables Continuity features, such as Instant Hotspot and SMS relay, for users who own both an iOS device and a Mac. Instant Hotspot is a convenience feature that allows Mac owners to connect automatically to a Hotspot-enabled iPhone with minimal configuration. Another phone-centric feature, SMS relay expands text messaging, forwarding all iPhone text messages to an iPad and Mac. SMS Relay also allows owners to send new text messages and respond to existing messages from any device. iOS 8.1 brings back the Camera Roll, which had gone missing in iOS 8.0. iPhone, iPad and iPod touch owners can download the iOS 8.1 update over the air by going to Settings > General > Software Update. Owners also can connect their iOS device to their computer and install the update via iTunes.
McDonald's CIO says decision to support Apple Pay was "not difficult"
With Apple Pay set to go operational across 220,000 merchant locations today, McDonald's CIO Deborah Hall-Lefevre recently explained why the ubiquitous fast food chain was so willing to be an Apple Pay partner at launch. In a recent interview with CIO, Hall-Lefevre articulated that because thousands of McDonald's locations already have NFC enabled POS terminals, supporting Apple Pay didn't involve any upgrade costs. Further, Hall-Lefevre relayed that McDonald's took a close look at the security mechanisms governing Apple Pay and came away impressed. McDonald's tested Apple Pay at its Point of Sale (PoS) lab in Oak Brook, Ill., and the results earned a green light. "We've done full end-to-end testing that included folks from McDonald's and Apple," Hall-Lefevre says. "We've closed the loop and feel very confident." ... McDonald's is so confident in Apple's security that it is not using any safeguards beyond those provided by Apple and the rest of the financial payments network. "Apple Pay transactions will be handled like any other cashless transaction," Hall-Lefevre says. As a result, Hall-Lefevre said that getting the higher-ups at McDonald's to throw their support behind Apple Pay was "not difficult." Following the release of iOS 8.1, iPhone 6 toting McDonald's customers will be able to use Apple Pay in-store and at drive-through locations as well, the latter being accomplished by what can only be referred to as a POS machine on a stick.
Full list of Apple Pay partners now stands at 58
When Apple first introduced Apple Pay this past summer, it said that the service would initially be available at 220,000 merchant locations spread out across 18 retail companies. On Thursday, Apple revealed that the number of retail companies planning to support Apple Pay at checkout now stands at 39. Meanwhile the number of apps planning to support Apple Pay currently stands at 24. Accounting for some crossover, Apple Pay will be supported in some form or another by 58 distinct brands. The current and list of Apple Pay retail partners is as follows, with recent additions in bold: Apple Pay support at launch: Aeropostale BJ's Wholesale Club Champs, Chevron ExtraMile Champs Foot Locker Footaction House of Hoops Kids Foot Locker Ladies Foot Locker Office Depot Urban Outfitters Sports Authority RadioShack SIX:02 RUN by Foot Locker Texaco Wegmans Apple Babies"R"Us Bloomingdales Macy's McDonalds Petco Panera Bread Subway Toys"R"Us Unleashed Whole Foods Nike Walgreens Duanereade Disney Store PetSmart Support later this year Anthropologie Free People Urban Outfitters Sephora Staples Walt Disney Parks and Resorts Apple on Thursday also announced an increase in the number of apps with built-in Apple Pay functionality. The full list of apps that will support Apple Pay reads as follows (new additions are in bold): Support at launch Chairish Houzz Instacart Lyft HotelTonight SPRING Staples Fancy Apple Store app Disney Store Groupon MLB.com OpenTable Panera Bread Target Uber Sephora Starbucks Support later this year Airbnb Eventbrite JackThreads Levis StubHub! Ticketmaster Tickets.com Disney Store Sephora Starbucks
Apple announces iOS 8.1 with Camera Roll, iCloud Photo Library
As part of its October press event, Apple announced several upcoming features it is adding to iOS 8.1. The next major release of iOS 8 will see the return of the popular camera roll, which was replaced in iOS 8 much to the chagrin of iOS users. Apple also will enable Apple Pay, presumably in time for the October 20th launch. iCloud Photo Library also will roll out for every iOS owner as a public beta. iCloud Photo library, available only to select beta users, allows you to share your photos between devices, using iCloud drive as an intermediary storage location. Apple will rollout iOS 8.1 alongside Apple pay on Monday, October 20.
Apple Pay goes live on October 20, many new retail partners and banks on board
Tim Cook earlier today provided new details regarding Apple Pay, the company's upcoming mobile payments platform. First and foremost, the service is slated to go live on Monday, October 20. Second, Apple has shored up the number of banks and retail partners throwing their support behind Apple's nascent payment platform. In addition to the nation's top banks, Tim Cook relayed that 500 new banks will support Apple Pay in the coming months. On the retail front, Apple's list of merchant partners has expanded considerably. Tim Cook also explained that the number of mobile apps with built-in support for Apple Pay has expanded. The list of Apple Pay compatible apps now includes Airbnb, StubHub, Lyft, and more.
Apple Pay launches Monday with support from Starbucks, Macy's and others
Apple has just kicked off the iPad extravaganza with a big piece of news about its Apple Pay initiative. It'll launch this Monday, and now has the support of 500 US banks along with major retailers like Starbucks, Macy's, McDonald's, Disney, Walgreens and Target. To remind you, Pay will make it possible to use your iPhone 6 and 6 Plus at the till (or online) instead of pulling out a credit card, since they're the first Apple handsets with contactless NFC. It'll work in conjunction with the Touch ID fingerprint scanner, and let you use any credit cards you've stored in Passbook. Meanwhile, the new iPhones' Secure Element chip encryption is fenced off from iOS and iCloud, so that even Apple itself can't see confidential purchase information. If you're good with all that, you can give it a crack starting October 20th -- a partial list of retailers is available here.
American, Chinese consumers more enthusiastic about smartwatch wallets than Europeans
A survey conducted by German market research firm GfK seems to indicate that the ability to use a smartwatch like the Apple Watch for electronic payment receives a more enthusiastic response in the US and China than in European countries. The survey tapped 1,000 smartphone owners each in the US, UK, Germany, South Korea, and China. While 54 percent of Chinese and 40 percent of American respondents said they'd be interested in using a smartwatch-based contactless payment system, only 27 percent of those in the UK and South Korea, and 20 percent of German consumers were excited about the prospect. Likewise, 70 pecent of Chinese consumers, 50 percent of Americans, and 43 percent of South Koreans were interested in storing personal health information in a smartwatch, while only 33 percent of UK respondents and 25 percent of Germans had any interest in doing so. AppleInsider's Sam Oliver speculated that the relative lack of credit card-based contactless payment systems in the US and China could be one reason that consumers in those two countries are so receptive to the idea of gaining faster payment through a smartwatch-based system. Apple Pay, Apple's NFC-based smart payment system that works with the iPhone 6 and 6 Plus, begins its rollout in the US this week and should be an early indicator of just how Americans will react to being able to make payments without reaching for a wallet.
Apple Pay setup process detailed in newly leaked screenshots
With Apple Pay rumored to be launching later this week, 9to5Mac has obtained purported screenshots from an Apple training manual which show, amongst other items, how the sign-up process will operate. In typical Apple fashion, getting started with Apple Pay appears to be a straightforward affair. Users will have the ability to set up the service either from the Passbook app itself or via a new option within the settings pane dubbed "Passbook & Apple Pay." Adding a particular credit or debit card is as simple as using a card already associated with one's iTunes account. New cards can be added to the app via a photo or by manually entering in the appropriate card information. Notably, the training manual obtained by 9to5Mac provides a number of additional details about Apple Pay that were previously undisclosed. Interestingly, the Passbook/Apple Pay settings will have deep ties to the credit card companies and banks involved in the service. For each connected credit card/bank, users will have a simple list of recent transactions, quick access to download an accompanying App Store app, the ability to contact their bank, the option to receive push notifications, and a display of both their credit card's number and the unique device account number. Another cool tidbit is that if a credit card expires, Passbook will automatically update the card with the new expiration date from the credit card company. Users will not need to delete and re-add the card; they will simply receive a push notification alerting them that the changed occurred. The report further adds that Apple Pay will be able to hold up to 8 credit/debit cards per device and that employee training for the impending service has already begun. While Apple hasn't yet announced an official launch date for its mobile payment service, an alleged internal memo from Walgreens indicates that the service is scheduled go live this coming weekend. Perhaps bolstering that notion, the following photo was recently spotted at a Whole Foods in the Denver area. Remember that Whole Foods is an Apple Pay launch partner. As we've previously reported, Apple Pay has been set up to be extremely secure and is the culmination of months of hard work and close collaboration between Apple, credit card companies, and some of the largest banks in the country. When Apple Pay goes live, it will be available in 220,000 merchant locations across the country. The list of launch partners includes McDonalds, Whole Foods, Subway, Macys, Walgreens, Nike, and Disney.
Leaked Walgreens memo points to Apple Pay launch on October 18
A leaked internal Walgreens memo obtained by MacRumors suggests that Apple Pay will go live on Saturday, October 18. Apple Pay, of course, represents Apple's foray into the world of mobile payments. The service promises to be extremely secure and rather quick and easy to use. The number of merchants at launch will be relatively small (~220,000), but that figure is likely to mushroom in the coming months. Recall that all merchants who accept credit and debit cards will be incentivized to upgrade their POS machines to more modern models by October 2015. While a previous report from The Daily Dot, based on information from USAA, floated a launch date of November 7, it's entirely plausible that Apple Pay will launch at different times for varying banks. Indeed, a quick glance at Apple's Apple Pay website shows that USAA is listed as an Apple Pay partner that's "coming soon", as opposed to banks that are already on board like Bank of America, Citi, and Capital One. With an Apple media event slated to take place next Thursday, we'll likely get an official world on the Apple Pay launch next week.
Apple Pay's biggest hurdle may be stores that are slow to support it
Apple Pay leveraged a consumer desire for speedy and secure payments into a wave of anticipation for the upcoming service. While Pay will only be available on recent devices, its complex security makes it attractive to consumers and banking institutions alike. Given enough time, every mobile user needs to update their phone; eventually today's iPhone 4S users will be tomorrow's iPhone 6 Plus users. There's just one more hurdle Apple Pay needs to jump to be successful: getting a huge number of retailers to accept the service. The Daily Dot has compiled a list of retailers who will not be accepting Apple Pay for reasons ranging from incompatibility with current point of sale equipment to looking into other mobile payment options. Companies like Pizza Hut, Chipotle, H&M, Best Buy, Wal-Mart, Publix, and Belk will not be accepting Apple Pay when it launches. In most cases, the companies are saying that it may be over a year before they're able to take payments via the system. This slowness to integrate Apple Pay makes sense for some companies. Apple Pay uses a NFC payment system which many stores current can't handle. As point of sale equipment is updated over time, more stores will be able to adopt the system. In the meantime, consumers will still be able to use the service at Bloomingdales, Macy's, Whole Foods, and a host of other stores. We look forward to seeing how this technology expands once it's finally released to the public.
Why Apple Pay is poised to succeed where others failed
The notion of using smartphones to make mobile payments is nothing new. Google Wallet launched all the way back in 2011. But Apple, in classic fashion, is joining the party late and may very well end up succeeding where many others have failed. In this regard, Apple Pay is in many ways classic Apple. They're not reinventing the wheel, they've just made some notable adjustments and are promising a smoother, safer, and more user friendly ride It's easy to scoff at Apple Pay and cynically assert that many other companies have already been there and done that and failed. And truth be told, it remains to be seen if customers do, in fact, take to Apple Pay in droves. But for a variety of reasons listed below, Apple Pay is better positioned to succeed than any other mobile payments platform we've seen to date. 1. It's secure For starters, Apple Pay has been designed to be incredibly safe and secure. User credit card information is never stored on Apple's servers nor does it reside on the iPhone. Instead of transmitting encrypted credit card data, Apple Pay instead transmits digital tokens to ensure that no sensitive and personal credit card information is ever actually shared with merchants. Importantly, tokens themselves are worthless and ultimately useless in the hands of hackers. Equally as important, the reliability and effectiveness of Touch ID ensures that only designated individuals can authorize transactions. In this regard, the timing of Apple Pay couldn't have been positioned more perfectly. Over the past 12 months, millions of consumers have grown accustomed to using their fingerprint as the login for their iPhone. Today, the notion of using one's fingerprint to make mobile payments is a lot less daunting than it was even a few months ago. Banks and credit card companies are excited about Apple Pay because it promises to lower the incidence of fraud. And as we've mentioned previously, it may very well be the safest way to make any type of credit card payment. 2. Apple has a huge head start Apple already has over 800 million credit cards on file. This provides Apple with an absolutely huge go to market advantage that no other company can currently or has ever been able to match. Apple's reservoir of 800+ million credit cards is a factoid that's been spouted so many times that it's almost easy to gloss over it and ignore how significant it really is. Convincing users to try out a new payment platform is no small task. Often times, the hardest part is just getting a consumer's credit card information in the first place. With Apple's cache of user credit cards already in place, it's magically able to bypass what for other companies would be a problematic bottleneck. Apple doesn't need to convince you to upload your credit card and then try Apple Pay, they just need you to try Apple Pay. Just like that, a big mobile payments hurdle is relegated to the rear view mirror. 3. Merchants have to upgrade their POS machines by October 2015 A limiting factor to the potential success of Apple Pay lies in merchant adoption. Though Apple is touting that Apple Pay will be accepted at 220,000 merchant locations in the U.S., that's just a small drop in the bucket compared to the 9 million or so merchant locations located in the US. Some of the more advanced POS machines can cost upwards of a few hundred dollars and merchants content with the status quo may have no reason to upgrade. For now. But come October 2015, all merchants who accept credit and debit cards will have to upgrade their POS machines to models that accept EMV credit cards. In the process, many merchants will likely upgrade to NFC compatible machines. While merchants won't be punished outright for not upgrading, there's a strong incentive for them to do so as merchants who do not upgrade will have to bear the costs of fraud. Merchants who do upgrade will not be on the hook as liability in the instance of fraud will shift to the banks. PandoDaily highlighted the October 2015 deadline a few weeks back: As of October 2015, any merchants that do not support EMV credit cards – smart cards with integrated circuits that enable point of sale authentication and help prevent fraud – will be liable for the fraudulent use of counterfeit, lost, and stolen cards 4. Banks are putting their full weight and support behind Apple Pay While many innovative payment apps and platforms attempt to work around large financial institutions, Apple instead chose to work closely with the nation's biggest banks. Further, because the Apple Pay process is extremely secure, banks stand to benefit from the success of Apple Pay because it will help lower the incidence of credit card fraud. In fact, its why Apple was able to extract what's rumored to be a .15% fee for each Apple Pay transaction. Consequently, the public advertising push banks are making for Apple Pay is unique and unprecedented. A number of banks have prominently featured Apple Pay on their website landing pages recently. Additionally, some have started alerting customers via email about this great, new, secure, and easy way to conduct mobile transactions. For instance, here's an email Bank of America sent out to customers a few weeks ago. Over and above that, the support of banking institutions helps position Apple Pay as a legitimate, and more importantly, a safe way to pay for goods. In a similar vein, it's a good bet that once Apple Pay goes live, banks will help advertise Apple Pay in-store at hundreds of branches across the country. This is advertising that money can't buy because overt support from banking institutions lends Apple Pay more credibility. It's an authoritative endorsement and consumers will not only be more aware of Apple Pay's existence, they'll be more likely to give it a try. It's not an overstatement to state that banks -- and the financial industry at large -- have never before been so unanimously behind a mobile payment platform that they themselves didn't create. And of course, this is all made possible because Apple isn't injecting themselves into the payment process, they're simply facilitating it. 5. Apple has clout, influence, and a willing user base In getting Apple Pay off the ground, Apple was impressively able to wield its clout and influence to secure deals with all 3 major credit card networks and the top banking institutions in the U.S. Previous mobile payment efforts have been fragmented affairs that lacked the full support from all the major financial players. Apple Pay is different. As former credit card executive Tom Noyes astutely pointed out, "banks are focused on Apple because: #1 Apple can move the needle in adoption." Further, because Apple operates at the high-end of the market, iPhone owners, on average, have more disposable income and will likely be more willing to use a platform like Apple Pay. Apple already has hundreds of millions of users who are accustomed to paying Apple for apps and all types of media content. To that end, the company has engendered a level of trust amongst many of its users that other companies would kill for. Users who would otherwise be completely disinterested in something like Google Wallet may be more inclined to give Apple Pay a spin. 6. Apple Pay is an intuitive and seamless process (so we hear) Apple Pay hasn't gone live yet, but if the demos Tim Cook and company demoed on stage are accurate, the Apple Pay experience promises to be extremely quick and easy. Notably, initial hands-on reviews of Apple Pay have been universally positive, with The Verge calling it "remarkably smooth" and Slashgear labeling it "pretty darn easy" to use. That's certainly encouraging, though the real measure of its ease of use will occur in the wild. Challenges Ahead The fact that Apple Pay is better positioned for success than other mobile payment platforms is in no way a guarantee that it will ultimately resonate with consumers. Apple Pay may very well be the safest and easiest way to make mobile payments but who's to say if consumers on a grand scale truly find using credit cards or toting around a wallet so burdensome in the first place. It's also important to remember Apple Pay will be a slow and steady rollout. The feature only works on iPhone 6 models (until the Apple Watch launches) and, for the time being, will only be available in the U.S. On the merchant side of the equation, Apple Pay will be supported at 220,000 merchant locations. That may seem like a big number, but the figure represents less than 3% of all merchant locations in the U.S. The flip side is that a few of the merchant locations on board with Apple Pay are extremely high volume stores that serve tens of millions of consumers. So while Apple has a ways to go towards being accepted in more locations, its initial group of partners -- from McDonalds to Subway to Walgreens -- is subtly strategic. Apple Pay will be available in a number of nation-wide locations that handle insane levels of foot traffic and an astounding number of daily transactions. To that end, the 220,000 figure is arguably less important than the types of shops those 220,000 locations represent. Still, the figure will have to increase dramatically for Apple Pay to truly influence consumer shopping habits.
Morgan Stanley is totes in love with Apple Pay
With Apple Pay slated to launch this month, all eyes are on Apple to see if it can shake the curse of NFC payment systems and break through to mass adoption. We won't know if it succeeds for a while, but Morgan Stanley's Craig Hettenbach certainly seems upbeat about the possibility. In a release to investors -- which AppleInsider pored over -- Hettenbach makes some big predictions for Apple's future in the payment space. "By reducing fraud, improving data security, and increasing credit/debit volumes for issuers and networks, while protecting the value of the existing payments value chain, we believe Apple Pay has a high chance of success," Hettenbach boasts, adding that Apple appears to have solved all the major problems that have plagued past NFC payment efforts from the likes of Google and PayPal. Hettenbach also notes that wide adoption of Apple Pay will likely help boost the appeal and adoption of its competitors' payment platforms as well, which makes a lot of sense. Right now, NFC on the iPhone 6 and 6+ will remain locked down and out of reach for third-party developers who might want to use it, like Google, but if those bars are removed in the future, it could potentially cause even greater competition between the two tech giants.
