Monthly Archives: September 2014

Will Apple Pay Change How POS is Done?


Photo Credit to NY Times

Last week during Apple’s annual release event the company announced that the new iPhone 6 and Apple Watch will come with NFC (near-field communication) technology which allows people to pay for their purchases using their phone. By doing so, Apple is joining companies like Square, and PayPal, along with Verizon, AT&T and T-Mobile’s joint NFC payment method, Softcard (formerly Isis Mobile Wallet) in an effort to own the digital wallet.

Already, there have been reports suggesting that Apple has finalized agreements with major credit card companies Visa, MasterCard, American Express, and Discover. The agreements state that the financial groups are getting involved and that their card networks will soon be supported by the Apple Pay system. Credit card companies are not the only ones who stand to gain from Apple’s near-future software update. VeriFone is possibly the biggest name in the NFC payment technology space. The fact that Apple is promoting NFC as a legitimate method of payment has the potential to be huge for VeriFone, and indeed other companies that not only offer but accept akin designs.

As we’ve witnessed from similar past ventures (i.e. Square, PayPal and Softcard), success in this realm is much easier said than done. All of these companies have at one point offered NFC payment technology and found it to be extremely difficult. Apple is not immune to risks, and Apple Pay will not come without its own set of difficulties. For the update to work it must win over two sets of clients- customers and merchants. For either side to make the switch, Apple needs to make paying with its device’s better. Better is to say simpler and more rewarding than swiping a traditional credit card. Some critics believe that Apple is trying to solve an issue that isn’t all that big of a deal in the first place. That is, the time that it takes to pay with a credit card. Others point out the slow adoption rate by some merchants. By the time Apple Pay is released, less than 3% of merchants will have the ability to accept payments that use the feature.

Every innovation has concerns that are inherent, that’s the name of the game. Apple’s innovations are no different. However,  because of Apple’s history of success, those of us who stand to gain from potentially increased efficiency and privacy of payment should pay close attention to the role Apple is trying to play in the POS industry with their upcoming release of Apple Pay.