Apple made several announcements related to Apple Pay at its Worldwide Developers Conference: Apple Pay expected to surpass 1 million acceptance locations in the US next month, broad support for retailer loyalty / rewards programs and retail private label credit cards, UK market launch next month with eight banks and 250,000 acceptance locations, Passbook to be renamed ‘Wallet’ with the release of iOS 9 in the fall. Apple Pay’s strong momentum continues and the enhancements related to retailer cards is significant as it broadens the payment service, provides consumers a more compelling and complete digital wallet solution and poses a question on the viability and relevance of MCX / CurrentC – particularly as major retailers capitulate to Apple. It is worth mentioning that Google Wallet is also supporting retailer loyalty programs; not clear on the direction of Samsung Pay.
Verifone stated that it will be among the first terminal manufacturers to support retailer loyalty cards via Apple Pay. Verifone’s MX 915 and MX 925 NFC terminals will be enabled to accept loyalty cards from six major national retailers. The integration of payments and loyalty provisioning at the POS is a big win for consumers and merchants, both from a convenience standpoint as well as overall commerce enablement and real-time data analytics. We expect to see more developments in this space.
Square is launching an NFC and EMV device to accept both mobile payments as well as EMV cards. This new reader is part of a new Apple partnership, ‘Apple Pay with Square’. The devices will start shipping out in the fall and cost $49. To encourage adoption, Square is offering the first 250,000 readers for free with a $49 fee rebate after purchase. For small businesses accustomed to using Square, this is a great addition as it expands their payment acceptance capabilities to NFC and EMV with a simple, elegant and cost-effective solution. For Apple Pay, this enlarges the acceptance universe particularly in the small business sector.
MasterCard has responded to the UK Treasury’s “Digital Currencies: Call for Information” with some criticism and skepticism particularly as it relates to speed, trust and compliance. However, MasterCard did acknowledge the potential of digital currencies to “become much more significant payment systems.” The debate continues.