Apple Pay is 'Growing at a Tremendous Rate' With 5X More Transaction Volume Than Last Year

[kdarling]

Why are chip cards so slow in the U.S.? Typically here it takes a second or two for the card reader to prompt you to enter you pin number and after that another second or two for the transaction to be authorised. All in all it's very fast.

I think it mostly seems slow to us here in the US because we're using to swiping and putting away our card while the transaction churns. Also, since there's no PIN to enter, the time the card is inserted seems extra long.

However, as others have noted, Visa and MC are putting out new terminal updates which will make it seem faster again by doing the card info exchange first, and letting people fairly quickly pull out their card to put away as before.

They'll say that and then proceed to swipe their card through the terminal. I'm embarrassed to live in America sometimes. Thanks media for providing a bad reputation for these types of cards!!

No need to be embarrassed. According to the records I've read, almost every country actually took several years to get used to it. They just don't remember all that now

Also, I hate the noise those terminals make when the card was successful.

True! Everyone does. Who chose that sound? It sounds more like an error transaction than a success. Woof.

I think its because currently, the machines can only see a contactless payment as being 'unverified' and so default to the £30 limit. The software/firmware needs updating so that the code can identify Apple Pay as being a 'verified' contactless payment, and so remove the limit. I suppose thats a big deal for a supermarket chain to impliment, too many people to sign off to make it happen quickly.

The terminal doesn't know or care that it's Apple Pay or Android Pay or whatever.

But the terminal has to be updated enough to recognize the standardized On Device Customer Verification flag that Apple Pay sends (and which any other payment method could, but does not yet).

 

[nikko1423]

Only started using it recently, and absolutely love it.

I'm often out with my phone in my hand for music so it's incredibly convenient.

Be good if they could incorporate store loyalty cards into it though - if the point is to eliminate the need to get your wallet out, then it's a shame you still need to get it out for the loyalty cards.

They actually do. Just not very many, so perhaps not the ones you tried. Started in iOS 9. Walgreens was the first to add their loyalty card

 

[MH01]

Its not hard to achieve 5x the transactions when major banks start offering the service . A couple of major banks in EU and US and you get that growth every year.

I think its a fantastic service , but its been very slow to roll out. Took my bank forever.

 

[johngordon]

They actually do. Just not very many, so perhaps not the ones you tried. Started in iOS 9. Walgreens was the first to add their loyalty card

Ah, OK - thanks - I'm in the UK, so was trying with Waitrose.

I have an app Scorecard, which lets you add cards in there, which can be opened in Wallet, but when I tried to get them to scan the bar code from the phone, it didn't work.

If its possible to have it incorporated in AP itself, hopefully more will get that set up.

 

[knemonic]

I think it mostly seems slow to us here in the US because we're using to swiping and putting away our card while the transaction churns. Also, since there's no PIN to enter, the time the card is inserted seems extra long.

However, as others have noted, Visa and MC are putting out new terminal updates which will make it seem faster again by doing the card info exchange first, and letting people fairly quickly pull out their card to put away as before.



No need to be embarrassed. According to the records I've read, almost every country actually several years to get used to it. They just don't remember all that now



True! Everyone does. Who chose that sound? It sounds more like an error transaction than a success. Woof.



The terminal doesn't know or care that it's Apple Pay or Android Pay or whatever.

But the terminal has to be updated enough to recognize the standardized On Device Customer Verification flag that Apple Pay sends (and which any other payment method could, but does not yet).

Btw, nfc is just as fast or faster than swiping a card, so why should we settle for chip cards that take three times as long, when we already have nfc in more and more places these days?
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More secure than using the magnetic stripe on your card to make a purchase.



It's a software update so merchants don't have to buy new terminals. The type of transaction used is determined by the card itself, not the terminal.



The ones at Rite Aid actually talk to you. But I can see why they make noise, so you don't forget your card.
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Julie's Diner in North Syracuse, NY takes EMV but doesn't have the enabled consumer facing terminal, just a counter top one. Should that be on your list?

I've heard in npr and read elsewhere that to make the chip cards faster they'll need new terminals, so I'm curious where you heard it was just a simple software update.

 

[tmiw]

Btw, nfc is just as fast or faster than swiping a card, so why should we settle for chip cards that take three times as long, when we already have nfc in more and more places these days?

You're talking about a country where retailers would be perfectly okay with people going back to cash for most/all of their purchases. It's against their self-interest to do more than the minimum with regards to cards.

(On that note, I hear that Visa/MC offered UK merchants significant discounts on their card fees to get them to accept contactless/NFC payments. I wouldn't be surprised if they have to do that in the US too.)

 

[kdarling]

I've heard in npr and read elsewhere that to make the chip cards faster they'll need new terminals, so I'm curious where (he) heard it was just a simple software update.

Google "visa chip card speed up" ... every article says it's being done via software update.

Perhaps you heard something where they were also talking about needing new terminals just to use the cards at all.

 

[American Hero]

I've heard in npr and read elsewhere that to make the chip cards faster they'll need new terminals, so I'm curious where you heard it was just a simple software update.

In the articles I've cited.
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Btw, nfc is just as fast or faster than swiping a card, so why should we settle for chip cards that take three times as long, when we already have nfc in more and more places these days?

Because grandma isn't going to pay with Apple Pay. Look how slow the adoption is with mobile payments at this time.
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You're talking about a country where retailers would be perfectly okay with people going back to cash for most/all of their purchases. It's against their self-interest to do more than the minimum with regards to cards.

America likes to practice "backwardsism."

Frankly I'm getting sick and tired of the, "we can do what we want" attitude from merchants in the U.S, not caring about their customer's best interest but only for their bottom line.

 

[knemonic]

Google "visa chip card speed up" ... every article says it's being done via software update.

Perhaps you heard something where they were also talking about needing new terminals just to use the cards at all.

This is the article I heard. You're right, it wasn't about replacing them, but what I got wrong is that many retailers haven't even been able to install them cause of the elaborate certification process that's super backed up. So to me when all these retailers already have a fast nfc solution available, that's way more secure than chip but not pin methods, and they're also convenient, I guess I don't get why they're not pushing that more, besides those who don't have nfc service activated on their phone.

 

[tmiw]

America likes to practice "backwardsism."

Frankly I'm getting sick and tired of the, "we can do what we want" attitude from merchants in the U.S, not caring about their customer's best interest but only for their bottom line.

It's more that to merchants, Visa and MasterCard add little value for what they get charged. Combined with the fact that those two companies have managed to get people to stop carrying cash around (making high minimums or cash-only policies unrealistic), it's no wonder there's so much resentment on the part of merchants. My view could be colored by my mostly small-business spending habits though.

 

[knemonic]

You're talking about a country where retailers would be perfectly okay with people going back to cash for most/all of their purchases. It's against their self-interest to do more than the minimum with regards to cards.

(On that note, I hear that Visa/MC offered UK merchants significant discounts on their card fees to get them to accept contactless/NFC payments. I wouldn't be surprised if they have to do that in the US too.)

If that happened that would be great. As much as I'm sure they want cash, that puts the burden on consumers, the need to have cash, the fact that if you give big bills they'll waste my time checking if they're fake and worse, having cash on me risks it getting lost or stolen. I never carry cash and always use my cc, so I prefer nfc. Also there are so many be perks to cc, cash back, extended warranties, miles, it's worth making your money work for you a little.
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It's more that to merchants, Visa and MasterCard add little value for what they get charged. Combined with the fact that those two companies have managed to get people to stop carrying cash around (making high minimums or cash-only policies unrealistic), it's no wonder there's so much resentment on the part of merchants. My view could be colored by my mostly small-business spending habits though.

I think if visa and MasterCard got rid of the per transaction fee and just charged a percentage, that would help merchants not impose minimums, which are ironically against the merchant agreements and would probably boost their sales. I usually get annoyed when a merchants says $5 minimum when I never carry cash, pointing out that's against merchant agreements and it feels like they're forcing me to buy more. If they can't afford to accept cc for all purchases it's probably Bette they don't accept them all, especially at a gas station, almost all purchases are for less than $5 after gas, which is done at the pump anyway. Mainly the minimums are really gas stations and crappy bars that enforce them.

I managed a shoe store for three years and the owner said to me something I never forgot "take money any way you can get it, cause it's better to have 98% of what they were gonna give you than none." That store has been in business for over 60 years.

 

[tmiw]

If that happened that would be great. As much as I'm sure they want cash, that puts the burden on consumers, the need to have cash, the fact that if you give big bills they'll waste my time checking if they're fake and worse, having cash on me risks it getting lost or stolen. I never carry cash and always use my cc, so I prefer nfc. Also there are so many be perks to cc, cash back, extended warranties, miles, it's worth making your money work for you a little.

Cash probably wouldn't be that big of a deal for smaller day to day purchases. Cards were originally invented as a replacement for checks, so I think most merchants would be somewhat okay with them if they were restricted to >$50-100 or so. Besides, losing ~3% on every card transaction would be better than possibly losing 100% from a bad check.

 

[American Hero]

It's more that to merchants, Visa and MasterCard add little value for what they get charged. Combined with the fact that those two companies have managed to get people to stop carrying cash around (making high minimums or cash-only policies unrealistic), it's no wonder there's so much resentment on the part of merchants. My view could be colored by my mostly small-business spending habits though.

It does create a record of transactions for them, and also provides the merchant with cashless currency. Why store all of that money and then have to count it up at the end of the day? That's a stupid business decision. I'd rather just pay a small percentage for insurance to accept cards and not have to do any cash organizing. All I would have to do is increase the price of every item by 3% and it's almost like I'd never been charged by the card companies. Also, if someone comes in to rob my store, "sorry but we only take cards, so we don't have any cash to give you."

Personally, if I ran a business, I wouldn't accept cash or checks. Just AMEX, Discover, MasterCard, and Visa along with my store loyalty card. I'd also have separate tap and go terminals next to the chip terminal to speed up the process of slow chipped transactions. For guys that are big on the benefits of cards like myself, I could see some customers having loyalty to a merchant simply because of the payment method(s) they offer the consumer. I know I prefer my local Wegmans over Subway when I go to buy a sub, because of the way the terminals are set up and the fact they take American Express when my local Subway doesn't.
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Cash probably wouldn't be that big of a deal for smaller day to day purchases. Cards were originally invented as a replacement for checks, so I think most merchants would be somewhat okay with them if they were restricted to >$50-100 or so. Besides, losing ~3% on every card transaction would be better than possibly losing 100% from a bad check.

Correction: debit cards were intended as a replacement for checks. Credit cards were never intended as a replacement for anything.
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I usually get annoyed when a merchants says $5 minimum when I never carry cash, pointing out that's against merchant agreements and it feels like they're forcing me to buy more.

Your thinking of the merchant agreement is outdated. The courts ruled in favor of merchants to apply minimums of no more than $10 per transaction. I'll get the link for you in a minute.

https://usa.visa.com/dam/VCOM/download/merchants/minimum-transactions-credit-card.pdf