How Apple Pay Will Change Mobile Payments
Apple has been in the business of pioneering new technology since its inception, and Apple Pay is no exception. For those who don’t yet know, this new payment technology will allow iPhone 6 or 6 Plus users to make secure payments both online and in brick-and-mortar stores.
The success of Apple Pay depends not just on user adoption, but requires stores to install Apple NFC (Near field communication) technology to recognize payments. Merchants should also be on the lookout for other technologies that will take advantage of Apple Pay down the line, which include iPad-based point of sale systems.
Merchant reception to NFC technology has been tepid at best, and even Google has failed to make its Wallet truly take off: As noted in PSFK, “While 50,000 to 100,000 people have downloaded the software, only a small percentage use it.” An article in Forbes points to a lack of availability of NFC-enabled devices – at the time of its release, Google Wallet was “limited to a few phones.” The “infrastructure to accept NFC payments” appeared to exist, but it did not have the support of the devices so popular with consumers. All this may change with the introduction of Apple Pay – iPhones are arguably the most popular smart phones with consumers, with online preorders of the new iPhones topping four million in 24 hours, according to Businessweek. With consumers ready to jump on board with the new, NFC-ready devices, now is the time for merchants to truly embrace the technology in-store.
Mobile payments as whole are arguably more convenient than traditional payment methods – instead of rifling through a wallet for cash or cards, consumers can pay for items with a simple swipe. There are, however, inherent inconveniences to mobile payments – namely that consumers can’t rely on every merchant accepting their preferred method of mobile payment, and may have to a wade through a sea of apps to find the appropriate payment app. Apple Pay draws on the overall, wallet-less convenience of mobile payments while eliminating the need to find the right merchant for the payment app. That is, as long as merchants offer NFC technology, they will have no issue accepting Apple Pay. Indeed, accepting Apple Pay would be no different than accepting Visa, Amex, or MasterCard.
Security has always been a question with mobile payments, and with recent breaches at major retailers, with point of sale transactions as a whole. Fox News notes that 45% of respondents in a survey conducted last year stated they did not use mobile payments because “they were concerned [with] security.” Apple Pay may be able to clear the air here as well – the same article notes several Apple Pay features that will ensure secure payments, including EMV technology, token technology, and Touch ID. These three technologies not only ensure that Apple Pay is a more secure method of payment than traditional credit cards (and perhaps more so than certain modes of mobile payment), but ensure that even if a consumer’s iPhone were to fall into the wrong hands, the thief could not use that iPhone for payments.
Apple Pay is slated to change the mobile payments space – not only because it is being spearheaded by a company renowned for its innovation, but because it offers the added security and convenience consumers need to trust and adopt mobile payments.
This article was contributed by Lisa Falzone
Lisa Falzone is the CEO and co-founder of Revel Systems, the award-winning leader in iPad point-of-sale (POS) systems for restaurant, retail and grocery. Since starting the company from the ground up in 2010, Ms. Falzone has been an entrepreneur in the truest sense of the word. She leads the day-to-day business operations and spearheads new business growth, and has also been instrumental in securing more than $13M in venture capital funding to date and assisting in international expansion of the San Francisco-based startup.