Apple Pay officially launched on Monday this week, coming to iOS smartphones and tablets capable of upgrading to iOS8. This is Apple’s first move to tackle the payments industry, currently sitting on 600 million iTunes accounts worldwide. Apple Pay will not only work for mobile and Web transactions, but will also act as an NFC payment solution for brick-and-mortar retailers.
At launch, Apple has grabbed some major retailers, like McDonalds, Staples, Nike and Subway. Others like Starbucks will work with Apple Pay on the mobile app side – allowing customers to pay for their drinks on their iOS app. The two major retailers, Walmart and Best Buy, have decided to go against Apple Pay, in favor of CurrentC. This will be a challenge for Apple, but given the two companies have both said they will look into Apple Pay, we might see them change their mind soon.
Apple Pay still has only a small amount of support in the U.S. compared to credit and debit cards, who have 9 million verified retailers, compared to the 300,000 of Apple Pay. Banks, on the other hand, are being incredibly receptive of Apple Pay, with 85 percent all confirmed to work with the payment service in the U.S. Early tests of the service are moderately positive, the NFC payment service still needs some work and is not as fast as CEO Tim Cook made out at their September 9 event. The online service, on the other hand, appears to work quickly, making it a much easier service than PayPal.
Apple Pay still needs to come to other platforms, like Android and Windows Phone, before becoming a fully fleshed service. With the lower barriers to entry on Android, it might be easier for Apple Pay to be offered as an API for developers.
Will this become the new standard? Too early to say – but Apple Pay has definitely opened up a rift in the payments market.