Mobile Payments: Will Apple Pay be a mobile payment game changer?

By Annett van de Bunt - Head of Marketing on 11. September 2014 in Market Insights

The latest iteration of the iPhone was revealed at a much-hyped event in Cupertino, California on Tuesday, 8th September. As expected, the Apple Watch was officially unveiled, but it was the official announcement of Apple Pay that made this latest update of major interest for the payments industry.


Sources speculated prior to the event that the new iPhone and Apple Watch would be NFC-enabled, plus there were reports of partnerships with Visa, Mastercard, and American Expressto develop a mobile wallet. Tuesday’s event confirmed this, with the Apple Pay digital wallet set to launch in the US in October.

Will Apple Pay really be an industry game changer as some analysts are suggesting?


A one-touch payment system using Apple’s Touch ID and linked to millions of iTunes accounts worldwide, bolstered by confirmed agreements with major US retailers including Macy’s, Walgreens, McDonalds, Subway, Disney and Nordstrom? PAY.ON believes that the basic ingredients are there for Apple Pay to drive major change in the mobile payments industry, but perhaps most importantly Apple is seen as having the clout to make an impact by championing contactless mobile payments.


However, both consumers and merchants will play a determining role in whether Apple Pay proves to be a sea change or just minor ripples. There may already be 800 million iTunes accounts worldwide, providing plenty of potential users, but first of all consumers will need one of the new NFC-enabled Apple devices. Second of all, they’ll need to see the benefit of utilizing the payment capabilities. Shopper experience remains all important.


Widescale merchant acceptance will be crucial too. Agreements with major retailers will provide a solid launch pad, but small and mid-sized merchants will need to see the benefits of investing in the technology needed to accept contactless mobile payments. Another piece of the puzzle is that merchants will need their payment service providers to offer suitable integration for the tokenized payments.

Markus Rinderer, CEO and Founder of PAY.ON AG, says; “Interestingly, Apple is not competing in payment processing, but rather they are relying on the existing processing networks. This being the case, PAY.ON and its payment ecosystem stand to benefit from the development of Apple Pay, and we’re looking closely at how we develop our payment technologies in order to offer suitable integration to our customers.”


All eyes will be on the US market, where Apple Pay will be released in October. The uptake amongst American consumers, who typically favor card payments, will certainly give a solid indication of how Apple Pay may fare when it’s rolled out across Europe and the rest of the world.


It’s certainly an interesting time for mobile payments, and PAY.ON will be following developments closely. As more information becomes available, we’ll revisit Apple Pay in greater detail, specifically addressing important issues surrounding securityand how payment service providers can adapt to changes to best serve their clients.


What are your thoughts? Let us know in the comments below…


Annett van de Bunt - Head of Marketing

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