Apple Pay - A year later, what's the verdict?

[tmiw]

Other than a recent problem with Discover and a grocery store, I'd have to go back pretty far to remember a time when I had an issue with it. I'm currently using it maybe 15% of the time, which is also unfortunate.

I think you'll be seeing a lot more of it soon. Next month is the deadline for merchants to upgrade their equipment to accommodate chip cards. Most of those machines will be NFC capable as well.

Most retailers are enabling chip without enabling NFC. I think the people expecting a sudden increase in the number of Apple Pay accepting locations in a couple of weeks will be disappointed.

I feel that most of us have forgotten the security benefit and merely looking at it from a convenience perspective. Also, I'm not sure how many year it took for the credit card industry to be wide spread enough for daily use, but I'm sure it took more than 2 years.

Security might matter to a few, but most people don't really care. Not when the fraudulent charge's reversed and a new card's on the way the instant you call your card issuer. I'd even go as far as to say that people don't really care that much about privacy either--otherwise people wouldn't shop at places like Target that mine customer data without their consent.

Security is great but if you can't utilize the functionality you receive no benefit. As only about 20% of the places I shop accept AP, it does me little benefit to utilize it. Samsung Pay on the other hand looks to have a much broader venue.

It's also keeping a technology alive that should have died a decade ago (like in Europe and elsewhere), basically giving retailers an excuse to half-ass their upgrades. This might be harsh but I'd rather there be no mobile payments at all in the US than us keeping a crutch around.

 

[dk001]

Other than a recent problem with Discover and a grocery store, I'd have to go back pretty far to remember a time when I had an issue with it. I'm currently using it maybe 15% of the time, which is also unfortunate.

It's also keeping a technology alive that should have died a decade ago (like in Europe and elsewhere), basically giving retailers an excuse to half-ass their upgrades. This might be harsh but I'd rather there be no mobile payments at all in the US than us keeping a crutch around.

Biggest issue is that you can't force AP / NFC onto the merchants. It might be good but.... Sorry, 20% doesn't cut it. Mobile pay is going nowhere and banks / big business want to profit from any changes. Predominately it is the little guy caught in the mess. Consumers just want a KISS solution. Right now, I am seeing a combo of Apple Pay, Android Pay, and Samsung Pay as a great step but the phone or watch isn't the solution. Not real sure what is.

 

[tmiw]

Biggest issue is that you can't force AP / NFC onto the merchants. It might be good but.... Sorry, 20% doesn't cut it. Mobile pay is going nowhere and banks / big business want to profit from any changes. Predominately it is the little guy caught in the mess. Consumers just want a KISS solution. Right now, I am seeing a combo of Apple Pay, Android Pay, and Samsung Pay as a great step but the phone or watch isn't the solution. Not real sure what is.

The stupid thing is that the majority of the new terminals have the hardware to do NFC. Retailers could have just purchased cheaper stuff without NFC support, so I wouldn't say it's being forced on them.

Really, they just don't want to be cut out of the payment process altogether, which is what Apple/Android/Samsung Pay's NFC implementations would effectively do. At least with EMV/chip they could still do data mining and everything else they were doing before with magstripe, and they also can't exactly block Samsung Pay's MST capability without causing collateral damage. It's not even about fees or software implementation costs at this point.

Honestly Google should have just ceded the mobile payment market on the Android side to Samsung and not bothered making Android Pay available in the US. They would then be able to focus on areas where there's a) already tons of NFC infrastructure and b) a retail environment that doesn't totally resent Visa and MasterCard. I'm not sure Apple would have been able to ignore the US though because Samsung Pay would inevitably result in calls for them to make Apple Pay available here.

FWIW, Apple Pay on the watch is definitely a better user experience than on the phone. This is from someone who owns both an iPhone 6 and the Apple Watch.

 

[placidity44]

Small town...haven't used it yet which I'm dying to use it on my watch and blow these tech illiterate minds!

 

[mpayne2k]

A year later and I can honestly say I've used Apple Pay less than 15 times! I've had various levels of success, mostly resulting in some card errors or frustrating experiences at the register forcing me to just go old school and whip out my card to swipe. Seems more stable the last 3 or 4 times I've used it, but apart from McDonalds I rarely see many options to use the service in Las Vegas. I travel often and have used it a few times, actually it was much more prevalent on a recent trip to London which is ironic considering the service just started there in late June/early July.

 

[aristobrat]

"It (Samsung Pay) uses tokenization, which means that your actual credit card isn't sent, instead it uses a temporary one that Visa or Mastercard creates for you."

This looks to be as secure as Apple Pay is or really darn close.
Security is great but if you can't utilize the functionality you receive no benefit. As only about 20% of the places I shop accept AP, it does me little benefit to utilize it. Samsung Pay on the other hand looks to have a much broader venue.

From what I've read, Samsung Pay only uses tokenization for NFC (tap) transactions.

When you say Samsung Pay has a much broader venue, if you're talking about how it emulates a mag swipe at terminals that don't have NFC capabilities, then it's sending your regular old credit card number (not tokenized).

http://www.tomsguide.com/us/mobile-wallet-guide,news-20666.html

 

[boltjames]

Small town...haven't used it yet which I'm dying to use it on my watch and blow these tech illiterate minds!

I'm in a big town (Manhattan) and I can tell you its the same thing here for the most part. I find it's one of four things:

1. Retailer doesn't have Apple Pay.
2. Retailer has Apple Pay but sales associate doesn't realize it.
3. Retailer has Apple Pay but their terminals are broken and they don't work.
4. Retailer has Apple Pay but they still impose a signature requirement which defeats the purpose.

About 90% of the time it's #1. For the 10% of the time it's a retailer that has Apple Pay enabled it's #3 half the time and #4 a quarter of the time, so only 10% chance I'm in an Apple Pay retailer and then only 25% chance it's going to work properly when I attempt it. Most times, I whip out the iPhone, get no response from the terminal, put the phone away, whip out the credit card.

No retailers are taking Apple Pay very seriously. It either works by coincidence with the terminals they've already got working or they're unwilling to invest in a compatible system and/or repair the terminals they already have.

BJ

 

[aajeevlin]

Nah, there is no rush. Eventually they will either get with the program or they won't. Just like there are people still paying with check, but they are far in between. This will take time just like everything else.

 

[tmiw]

No retailers are taking Apple Pay very seriously.

They are; they'd just rather we paid with, say, a Walmart app at Walmart and a Sears app at Sears and so on and so forth so that we can still be tracked.

 

[boltjames]

They are; they'd just rather we paid with, say, a Walmart app at Walmart and a Sears app at Sears and so on and so forth so that we can still be tracked.

Maybe things are different in SoCal, but here in NYC no retailers have installed brand spanking new NFC terminals so as to be Apple Pay compatible (or Sears compatible or Walmart compatible for that matter).

It's one of those things where if their 5 year old NFC terminals are already there and work with Apple Pay, great, they market it that way and take advantage. But if their terminals are not compatible, they know that their customers still need their milk and their underwear and they aren't going to lose a single sale because they can't let customers use their sexy phones to pay in a sexy way. Right now, it's a happy coincidence that a retailer is Apple Pay compatible; it's not happening because retailers are just dying for it.

BJ

 

[tmiw]

Maybe things are different in SoCal, but here in NYC no retailers have installed brand spanking new NFC terminals so as to be Apple Pay compatible (or Sears compatible or Walmart compatible for that matter).

It's one of those things where if their 5 year old NFC terminals are already there and work with Apple Pay, great, they market it that way and take advantage. But if their terminals are not compatible, they know that their customers still need their milk and their underwear and they aren't going to lose a single sale because they can't let customers use their sexy phones to pay in a sexy way. Right now, it's a happy coincidence that a retailer is Apple Pay compatible; it's not happening because retailers are just dying for it.

BJ

For me at least, my failure rate is a lot lower. Also, a fair number of smaller stores who have their new terminals somewhere hidden so they're not usable even if NFC's turned on.

As for the major stores who aren't going to turn on NFC any time soon, they basically saw how well the Starbucks app worked out and hoped to duplicate that in their own stores. If CurrentC had come out sooner than Apple Pay, it might have gotten some use too despite its issues. I think they're still hoping that they can get traction with it or some store specific app, hence why we haven't seen as many defections as we expected would happen after their three year exclusive ran out.

 

[aajeevlin]

For me at least, my failure rate is a lot lower. Also, a fair number of smaller stores who have their new terminals somewhere hidden so they're not usable even if NFC's turned on.

As for the major stores who aren't going to turn on NFC any time soon, they basically saw how well the Starbucks app worked out and hoped to duplicate that in their own stores. If CurrentC had come out sooner than Apple Pay, it might have gotten some use too despite its issues. I think they're still hoping that they can get traction with it or some store specific app, hence why we haven't seen as many defections as we expected would happen after their three year exclusive ran out.

Giving the way CurrentC is structured, I would never have use it. I'd be sticking to CC. Maybe with the less informed. Also, unless stores comes out with some extremely attractive incentives for using their payment system, there is is no reason to go away from CC. I get close to 2% on everything, beat that then we can talk.

 

[boltjames]

For me at least, my failure rate is a lot lower. Also, a fair number of smaller stores who have their new terminals somewhere hidden so they're not usable even if NFC's turned on.

As for the major stores who aren't going to turn on NFC any time soon, they basically saw how well the Starbucks app worked out and hoped to duplicate that in their own stores. If CurrentC had come out sooner than Apple Pay, it might have gotten some use too despite its issues. I think they're still hoping that they can get traction with it or some store specific app, hence why we haven't seen as many defections as we expected would happen after their three year exclusive ran out.

I hear you, but in my experience in the NYC area I've got stores with broken terminals (seems like every drugstore) then stores with NFC terminals that require a signature (Toys 'R Us comes to mind) then stores whose own sales staff doesn't know they have Apple Pay (Macy's just yesterday) stores with NFC who don't take Apple Pay (Dunkin' Donuts) and then stores without NFC terminals of any kind (almost all grocery stores here).

My point, and I think I'm right, is that I haven't seen a single national chain or decent-sized regional chain step up and retrofit their stores with NFC terminals just to say they are Apple Pay compliant. I've seen people take advantage of their coincidental compatibility (McDonald's) and a whole bunch of people not know or not care. It's a shame, I love the promise of the technology. But the day that I can leave my wallet at home? Feels like we'll land on Mars before that happens.

BJ

 

[JuryDuty]

I haven't used Apple Pay because I'm still on Android until the 25th, but I've used Google Wallet a bit. Apple Pay and Google Wallet are accepted in many places here in Chicago, but the logos for either are not always present. A lot of people don't realize that they are accepted whenever this logo is present.

THIS is important to note. I rarely see an Apple Pay logo. But I see this often. That said, I rarely have used it outside of McDonald's and a couple other restaurants (like Taco Cabana). Many merchants still require you hand them something rather than have a scanner in front of their machine for whatever reason.

 

[aajeevlin]

I hear you, but in my experience in the NYC area I've got stores with broken terminals (seems like every drugstore) then stores with NFC terminals that require a signature (Toys 'R Us comes to mind) then stores whose own sales staff doesn't know they have Apple Pay (Macy's just yesterday) stores with NFC who don't take Apple Pay (Dunkin' Donuts) and then stores without NFC terminals of any kind (almost all grocery stores here).

My point, and I think I'm right, is that I haven't seen a single national chain or decent-sized regional chain step up and retrofit their stores with NFC terminals just to say they are Apple Pay compliant. I've seen people take advantage of their coincidental compatibility (McDonald's) and a whole bunch of people not know or not care. It's a shame, I love the promise of the technology. But the day that I can leave my wallet at home? Feels like we'll land on Mars before that happens.

BJ

Now I'm not sure what's up over at NYC area. But over here, Macy's been working since last year, McD, Sprouts, paying cellphone bill etc. That was pretty much my last weekend, came home with $600+ spent with Apple Pay.

I have also used Apple Pay at Homedepot, Staples, Walgreen...

 

[tmiw]

Giving the way CurrentC is structured, I would never have use it. I'd be sticking to CC. Maybe with the less informed. Also, unless stores comes out with some extremely attractive incentives for using their payment system, there is is no reason to go away from CC. I get close to 2% on everything, beat that then we can talk.

REDcard gives you 5% back on everything at Target, which might be useful if you're a frequent Target shopper. Granted, you get that just by using the card, so unless MCX really fixes the transaction flow for CurrentC there's not much of a point. I've also heard of similar discounts being planned for other MCX retailers.

Also something to note--Starbucks' success is likely in part due to them a) still playing well with major credit and debit cards, b) not 100% fighting Apple and c) its reliability. For instance, their app supports Apple Pay and allows you to stick your Starbucks card in Passbook. Their scanners almost always scan the barcode correctly the first time. Considering all that I would be okay continuing to use their app instead of tapping my phone or watch at their locations.

I hear you, but in my experience in the NYC area I've got stores with broken terminals (seems like every drugstore) then stores with NFC terminals that require a signature (Toys 'R Us comes to mind) then stores whose own sales staff doesn't know they have Apple Pay (Macy's just yesterday) stores with NFC who don't take Apple Pay (Dunkin' Donuts) and then stores without NFC terminals of any kind (almost all grocery stores here).

My point, and I think I'm right, is that I haven't seen a single national chain or decent-sized regional chain step up and retrofit their stores with NFC terminals just to say they are Apple Pay compliant. I've seen people take advantage of their coincidental compatibility (McDonald's) and a whole bunch of people not know or not care. It's a shame, I love the promise of the technology. But the day that I can leave my wallet at home? Feels like we'll land on Mars before that happens.

BJ

Didn't Panera (one of the initial Apple Pay supporters) add support for it? I don't think they ever supported NFC before that time, though I could be wrong.

THIS is important to note. I rarely see an Apple Pay logo. But I see this often. That said, I rarely have used it outside of McDonald's and a couple other restaurants (like Taco Cabana). Many merchants still require you hand them something rather than have a scanner in front of their machine for whatever reason.

It's because in our infinite wisdom, we decided that Americans don't actually need a PIN on their new credit cards (you know, like in most of the rest of the world). No need to have anything accessible when cards people hand over aren't going to require anything other than a signature on a slip of paper.

 

[cub850G2]

I hear you, but in my experience in the NYC area I've got stores with broken terminals (seems like every drugstore) then stores with NFC terminals that require a signature (Toys 'R Us comes to mind) then stores whose own sales staff doesn't know they have Apple Pay (Macy's just yesterday) stores with NFC who don't take Apple Pay (Dunkin' Donuts) and then stores without NFC terminals of any kind (almost all grocery stores here).

Dunkin Donuts has NFC terminals? Last time I checked around here they still swiped it on their pos. Kohl's(Fall) and Dunkin Donuts should have support for Apple Pay soon. It will take a while but I think at a point in the near future where you will be able to pay with your phone at most places. I've used Google Wallet at hundreds of times by now and am now using Android Pay. I have a fairly high sucess with a few failures but it usually works.

 

[kjm18]

Use it a lot where I can especially with the watch as find it quicker than doing with the iPhone

 

[aristobrat]

REDcard gives you 5% back on everything at Target, which might be useful if you're a frequent Target shopper.

Home Depot and Lowe's also give a 5% discount on every purchase when using their in-house cards.

It's because in our infinite wisdom, we decided that Americans don't actually need a PIN on their new credit cards (you know, like in most of the rest of the world).

I read that's in part because the issuers here don't think Americans can remember a unique PIN for every credit card that they have. Nobody wants to be the card that doesn't get used any more because someone forgot the PIN. That, and lost/stolen card fraud (which is about all that having a PIN helps with) is so low in comparison to the duplicate card fraud that EMV + Signature helps with.

 

[aristobrat]

No retailers are taking Apple Pay very seriously.

Agreed.

I think that's because very few US retailers are taking NFC payments seriously.

I hope that after EMV has been out for awhile (and the quick card swipe has been replaced but a much longer card 'dip'), retailers will reconsider NFC as it will be a quicker and easier (IMO) way to pay.

 

[jayiw]

I see the NFC logo just about everywhere. I know Dunkin Donuts didn't have it though. You still have to hand them your card. But even with the NFC logo almost everywhere Apply Pay has been useless to me. Like I said, either they dom't accept it and when you ask about it the employees are clueless. I got tired of wasting my time and looking like a jackass waving my Apple Watch around a terminal over and over for no reason. Quicker and easier to go old school and swipe the debit card. Works everywhere, every time.

 

[tmiw]

I read that's in part because the issuers here don't think Americans can remember a unique PIN for every credit card that they have. Nobody wants to be the card that doesn't get used any more because someone forgot the PIN. That, and lost/stolen card fraud (which is about all that having a PIN helps with) is so low in comparison to the duplicate card fraud that EMV + Signature helps with.

In any case, the results of that choice are:

a) Restaurants aren't bothering with portable credit card readers (why spend the extra money when you can keep taking cards away from tables with no real consequence?)
b) Businesses in general aren't bothering to have terminals anywhere near accessible for customers, making chip and PIN cards problematic as well as Apple Pay. European visitors to the US probably will want to carry a lot of cash around.
c) Neutering a lot of the convenience advantages of NFC. For instance, Target lets you insert your card while they're still ringing up your stuff. If the amount's low enough, you can remove your card and leave within ~1 second after the clerk totals everything. I don't even think signature is a big deal for most people if required since no one checks, so Apple Pay supposedly not needing one doesn't resonate.

It's kinda ironic that NFC will fail in a large part due to that choice since the ultimate goal of Visa/MC all along has been for us to use mobile payments for most of our transactions.

 

[aristobrat]

It's kinda ironic that NFC will fail in a large part due to that choice since the ultimate goal of Visa/MC all along has been for us to use mobile payments for most of our transactions.

Seems like NFC is big pretty much everywhere else in the world, except the US.

I'm curious to know if it was big before those parts of the world got EMV, or if gained in popularity after EMV rolled out there.

I really think a lot of Americans are going to find the whole EMV "insert and leave your card in the payment terminal" thing to be a pain-in-the-ass, and that many are going to prefer the NFC tap method instead.

Right now, a NFC tap doesn't save much time compared to a card swipe.

 

[tmiw]

Seems like NFC is big pretty much everywhere else in the world, except the US.

I'm curious to know if it was big before those parts of the world got EMV, or if gained in popularity after EMV rolled out there.

I really think a lot of Americans are going to find the whole EMV "insert and leave your card in the payment terminal" thing to be a pain-in-the-ass, and that many are going to prefer the NFC tap method instead.

Right now, a NFC tap doesn't save much time compared to a card swipe.

Other countries also have NFC in physical card form, which the US tried before. It failed miserably here because the cards got a very bad (undeserved?) reputation for lacking security as well as not adding convenience, like what you said. Tapping a physical card is arguably more convenient than tapping a phone but that's unlikely to come back.

 

[dk001]

Seems like NFC is big pretty much everywhere else in the world, except the US.

I'm curious to know if it was big before those parts of the world got EMV, or if gained in popularity after EMV rolled out there.

I really think a lot of Americans are going to find the whole EMV "insert and leave your card in the payment terminal" thing to be a pain-in-the-ass, and that many are going to prefer the NFC tap method instead.

Right now, a NFC tap doesn't save much time compared to a card swipe.

EMV is a pain. Not the plug and wait so much as it takes a lot longer to process.
However ... I asked a couple of local merchants I frequent if they are getting NFC/EMV or just EMV. Both said their terminals are under contract and they get the cheapest they can. Sounds like that's a "No" to NFC.

Side note: watched a lady with a 6+ the other day at Whole Foods drop her phone when paying. We all cringed. It broke. How about an Apple Card that works just like a CC?