In the last Apple special event in september, the company from Cupertino introduced a new NFC payment service called Apple Pay. This new service allows to pay in any shop easily and fast just by approaching your Apple device (only on iPhone 6, iPhone 6 plus, iPad Air 2, and iPad mini 3 by now) to a NFC reader and introduce your PIN code or just using the fingerprint detector in some of the devices. Mobile payment have been around for a while but they have not take off yet, however Apple Pay seems to be a very good approach to mobile payments.
Basically Apple Pay has three main strengths: firstly, it is easy, secure and fast to use and this are “sine qua non” conditions in mobile payments. Secondly, it is provided by a company like Apple and this assures massive adoption in markets like U.S. and strong impulse from a company like Apple. Thirdly, the support of a number of retailers including some of the most important commercial chains in the U.S.
However,only 72 hours after the launch of Apple Pay on October 20th a number of retailers (WalMart, Rite-Aid, CVS, 7eleven and more) have disconnected their NFC readers, and therefore blocked Apple Pay payments in their stores. The reason behind that is CurrentC, the mobile payment service that retailers are working on and will arrive in the coming 2015. Basically they are blocking Apple Pay in order to protect their own mobile payment service. CurrentC is a mobile payment method that uses QR codes, the proces is as follows: scan a QR code, introduce a password in your device and then show it to the staff on the shop.
When comparing CurrentC and Apple Pay in terms of usability and user experience, seems clear that Apple Pay wins in every comparison. then, why are retailers pushing for CurrentC? The asnwer is very clear. CurrentC does not need any card provider (Visa, Mastercard, Maestro, etc..) and takes the money directly from a consumer’s bank account instead of charging a credit card. By using CurrentC, retailers would save a lot of money in card fees and they will also receive a lot of customer behaviour data.
Therefore here we are facing a situation where some retailers are trying to drive the usage of a mobile payments service in a way that the main beneficiary would be only them, without considering the user experience at any point. Now the main question point is, What will happen when users want to use Apple Pay service and it is blocked? Will they change their habbits and go to another shop? Probably they will not, as it is hard to break the convenience and proximity schemes with this stores. But this does not assure the success of CurrentC as mobile payment platform and we will see if at the end retailers are “forced” by users to accept Apple Pay payments. The asnwer to these questions, just in a few months from now.
If you want to know more about the topic we have select soome interesting contributions:
- Apple Pay, the next game changer on Medium
- CurrentC on Medium
- Should we boycott retailers who turn off NFC and Apple Pay? on Medium.
- Tim Cook on Retailers That Refuse Apple Pay on Wall Street Journal.
- Chronicle of a death foretold: CurrentC by Enrique Dans
- Apple Pay and Retailer Moves: Evolving Ecosystems Between Apple and Android? on Medium.
- Apple Pay’s Struggles Show Why It’s So Difficult to Build a Payments Platform on Medium.