Could Apple Pay become a threat to existing payment networks?
Payments
Asked by Question Bot09/Oct/20151 answer
1 Answer
F
Faisal Khan
Answered 09/Oct/2015
Difficult to fathom that happening, but then again, what may be foggy now, could be a clear-cut strategy to drive out traditional payment networks out of business.
In so far as anyone can tell, the payment innovation by Apple is riding on payment rails of existing relationships, albeit in a much more efficient (read: secure) manner.
Assuming everyone has an NFC terminal - great. Now Apple says how would you like to pay at your favorite retailer using our wallet, or our card (call it Apple Card, etc.), the question then comes into play, how do you load money onto an Apple Wallet? If you will attempt to cut-off the card schemes in one go, guess what will they do? They will retaliate the same way. The wallet (which I'm guessing will come and will be in the iTunes app), would be void of any VISA / MasterCard / American Express / Etc. logo'd card.
What will you use then? ACH? Perhaps. What about other markets that do not have ACH, but do attach their credit/debit cards to the iTunes app? How will that work.
I think Apple is going to dance with everyone (at least the big players). Sure, a few smaller players, and maybe a gross or so companies will go out of business, so be it. I think Apple will continue to work with other payment networks, till such a time, they have conclusive, and definitively figured out how to access your bank account (all over the world) to load money onto their own wallet. Once they have figured (or rather implemented) this - only then will they go after the payment networks (if they want to). Its a long envisioned game.
In so far as anyone can tell, the payment innovation by Apple is riding on payment rails of existing relationships, albeit in a much more efficient (read: secure) manner.
Assuming everyone has an NFC terminal - great. Now Apple says how would you like to pay at your favorite retailer using our wallet, or our card (call it Apple Card, etc.), the question then comes into play, how do you load money onto an Apple Wallet? If you will attempt to cut-off the card schemes in one go, guess what will they do? They will retaliate the same way. The wallet (which I'm guessing will come and will be in the iTunes app), would be void of any VISA / MasterCard / American Express / Etc. logo'd card.
What will you use then? ACH? Perhaps. What about other markets that do not have ACH, but do attach their credit/debit cards to the iTunes app? How will that work.
I think Apple is going to dance with everyone (at least the big players). Sure, a few smaller players, and maybe a gross or so companies will go out of business, so be it. I think Apple will continue to work with other payment networks, till such a time, they have conclusive, and definitively figured out how to access your bank account (all over the world) to load money onto their own wallet. Once they have figured (or rather implemented) this - only then will they go after the payment networks (if they want to). Its a long envisioned game.