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Apple Partnering With American Express to Bring Apple Pay to Canada, Australia, Spain, Singapore and Hong Kong

tmiw said:
Credit unions usually contract with a company like PSCU to handle their cards, so the backend part isn't the problem. I'd also go as far as to say that if a credit union or bank is relying on interchange to make up for revenue shortfalls, they aren't well-run.
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Banks make the real money off credit interest, not the interchange fees. Smaller banks and credit unions often offer lower interest cards to their members. (AMEX is the opposite, since their users must pay off the balance each month. They have higher interchange than other cards, which is why merchants avoid AMEX.)

When a bank/credit union signs up for Apple Pay, they suddenly have new extra fees on top of their normal operations:

1) The transaction fee that Apple demands.
2) The tokenization fees charged by the networks.
3) Extra accounting and auditing to make Apple happy.

Moreover, they are forbidden by the Apple Pay contract to pass on the extra costs to the ones who cause it: the Apple Pay customer.

Pistol Peto said:
I think in addition to the rates - they are worried long term about having a company in between them and their customers. People may start to look at Apple as part of their banking experience - and I think it's the law we're only allowed to have 5 banks ;)
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Yes, in addition to the high rates Apple wants, they don't like the power Apple is gaining over purchases by being the one to provision the device, and the only one allowed to put an NFC app onboard.

Banks are also not happy about the information that Apple wants sent back to them. The contract requires the banks to provide "an extensive set of statistics for Apple regarding their Apple Pay activity, including nearly three-dozen categories of quantifiable information. Categories include number and dollar volume of credit and debit activity, average ticket, breakdown of transactions between in-store and in-app usage, and top 100 merchants by charge volume."
 
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kdarling said:
Banks make the real money off credit interest, not the interchange fees. Smaller banks and credit unions often offer lower interest cards to their members. (AMEX is the opposite, since their users must pay off the balance each month. They have higher interchange than other cards, which is why merchants avoid AMEX.)

When a bank/credit union signs up for Apple Pay, they suddenly have new extra fees on top of their normal operations:

1) The transaction fee that Apple demands.
2) The tokenization fees charged by the networks.
3) Extra accounting and auditing to make Apple happy.

Moreover, they are forbidden by the Apple Pay contract to pass on the extra costs to the ones who cause it: the Apple Pay customer.
Click to expand...

Again, banks could have simply not signed on if they couldn't negotiate something better; it's not like Apple is forcing them. Obviously the math works out for at least some of them as multiple tens of FIs are joining every month. Even the UK banks with lower interchange agreed with Apple on a way to make it work somehow.

Sounds like the increased spending from Apple Pay users more than makes up for whatever Apple's charging.
 
g3nw1 said:
After living in Spain for 16 years & having a Spanish issued Amex card. The card IS accepted in MOST retailers/bars etc. and I only ever experienced problems in small establishments and local stores, places I would use cash anyway.

Most of the people I know in Spain have Amex cards and use them without problems, and as for Apples market share in Spain. I worked for a large Spanish company (over 6000 staff) with 90% mac hardware and even corporate iPhones and that was 3 years ago!

All of my friends and people I know in Spain have iPads/Macs/iPhones/AppleTVs. and I would really need to sit down and think who, if any I knew with a PC.

In short, I think this is a smart move on Apples part getting Amex on board first, also a great way of giving Amex users an exclusive deal in places that :apple:PAY has not yet officially arrived.

This should be taken at face value as a good business move for both parties, irrelevant of your views on Amex and hidden racist remarks about Spain.
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add to that the (at least in Barcelona) high acceptance of NCF/contactless payments and the market is ready.
 
DARKiLLUSiON said:
As expected the banks are dragging their heels on Apple Pay
*Article from The Globe and Mail*
Why Apple Pay's Canadian launch bypassed banks
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interesting article but it says that the issue is mostly with the credit card companies (Visa and Mastercard) and not with the banks. it's hard to make sense of it though. It doesn't really explain what specifically Apple wants from the credit card companies. it also says that MC was apparently ready to accept Apple's terms. so why isn't it an Apple Pay launch partner in Canada?
the issues mentioned by kdarling earlier in the thread make more sense but they were mostly with the banks if I understand it correctly.
 
kdarling said:
Banks make the real money off credit interest, not the interchange fees. Smaller banks and credit unions often offer lower interest cards to their members. (AMEX is the opposite, since their users must pay off the balance each month. They have higher interchange than other cards, which is why merchants avoid AMEX.)

When a bank/credit union signs up for Apple Pay, they suddenly have new extra fees on top of their normal operations:

1) The transaction fee that Apple demands.
2) The tokenization fees charged by the networks.
3) Extra accounting and auditing to make Apple happy.

Moreover, they are forbidden by the Apple Pay contract to pass on the extra costs to the ones who cause it: the Apple Pay customer.



Yes, in addition to the high rates Apple wants, they don't like the power Apple is gaining over purchases by being the one to provision the device, and the only one allowed to put an NFC app onboard.

Banks are also not happy about the information that Apple wants sent back to them. The contract requires the banks to provide "an extensive set of statistics for Apple regarding their Apple Pay activity, including nearly three-dozen categories of quantifiable information. Categories include number and dollar volume of credit and debit activity, average ticket, breakdown of transactions between in-store and in-app usage, and top 100 merchants by charge volume."
Click to expand...
very interesting. but these are all issues with the banks only and not with the credit card companies, right?
the article in Globe quoted by DARKiLLUSiON Why Apple Pay's Canadian launch bypassed banks
says the main unresolved issues are with the credit card companies (MC and Visa) and not individual banks. do you know what exactly would the credit card companies want?
 
kdarling said:
Banks make the real money off credit interest, not the interchange fees. Smaller banks and credit unions often offer lower interest cards to their members. (AMEX is the opposite, since their users must pay off the balance each month. They have higher interchange than other cards, which is why merchants avoid AMEX.)

When a bank/credit union signs up for Apple Pay, they suddenly have new extra fees on top of their normal operations:

1) The transaction fee that Apple demands.
2) The tokenization fees charged by the networks.
3) Extra accounting and auditing to make Apple happy.

Moreover, they are forbidden by the Apple Pay contract to pass on the extra costs to the ones who cause it: the Apple Pay customer.



Yes, in addition to the high rates Apple wants, they don't like the power Apple is gaining over purchases by being the one to provision the device, and the only one allowed to put an NFC app onboard.

Banks are also not happy about the information that Apple wants sent back to them. The contract requires the banks to provide "an extensive set of statistics for Apple regarding their Apple Pay activity, including nearly three-dozen categories of quantifiable information. Categories include number and dollar volume of credit and debit activity, average ticket, breakdown of transactions between in-store and in-app usage, and top 100 merchants by charge volume."
Click to expand...

1. You only have to pay off the balance in full each month if you have a charge card. AMEX used to exclusively offer charge cards but that's not the case anymore. AMEX offers credit cards too, and ones with good rewards at that. Keep in mind AMEX also makes a killing off of their card's annual fees.

2. AMEX makes more off of interchange fees at most merchants, but certain merchants do receive a discount for accepting the card, such as small business owners. Another reason merchants avoid AMEX is because AMEX is there for the consumer's advantage and not the merchant's. If you've ever had a dispute with a merchant with an AMEX purchase, you'd know they always take your side and charge back everything immediately.

3. I would suggest any American to use an AMEX card as their main card. The rewards and protections are usually superior, with only few exceptions (such as the Citi double cash or the U.S Bank Cash + card).
 
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macnewbie91 said:
1. You only have to pay off the balance in full each month if you have a charge card. AMEX used to exclusively offer charge cards but that's not the case anymore. ...
Click to expand...

Thank you very much for adding the details for those who are interested. (I simplified my comment about AMEX since it wasn't the point I was making, which was more about credit unions.)

tmiw said:
Again, banks could have simply not signed on if they couldn't negotiate something better; it's not like Apple is forcing them.
Click to expand...

True, at least as far as negotiations go. Witness Canadian (and perhaps Australian) banks.

As for "forcing" a choice, Apple is of course doing that by not allowing any other NFC payment method on their phone.

Obviously the math works out for at least some of them as multiple tens of FIs are joining every month. Even the UK banks with lower interchange agreed with Apple on a way to make it work somehow.
Click to expand...

It's still a small fraction of the banks and credit unions. As for the UK banks, it sounds like they failed to stick together as a group, unlike the Canadian banks. They fell like dominoes under PR pressure more than anything else.

Sounds like the increased spending from Apple Pay users more than makes up for whatever Apple's charging.
Click to expand...

Any increased spending is likely very tiny in comparison to the loss of bank accounts being moved.

V.K. said:
very interesting. but these are all issues with the banks only and not with the credit card companies, right?
the article in Globe quoted by DARKiLLUSiON Why Apple Pay's Canadian launch bypassed banks
says the main unresolved issues are with the credit card companies (MC and Visa) and not individual banks. do you know what exactly would the credit card companies want?
Click to expand...

Most of that article makes sense, but not that part. There's no real negative terms for the credit networks with Apple Pay.

On the contrary, Apple Pay gives the credit networks MORE stature (and revenue!) by setting them up as a major source for tokenization services, and by requiring banks to submit their Apple Pay royalties and reports through the networks instead of directly to Apple.
 
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kdarling said:
As for "forcing" a choice, Apple is of course doing that by not allowing any other NFC payment method on their phone.
Click to expand...

The choice we were talking about is whether banks want to join Apple Pay or not, and in that sense Apple isn't forcing them.

kdarling said:
It's still a small fraction of the banks and credit unions. As for the UK banks, it sounds like they failed to stick together as a group, unlike the Canadian banks. They fell like dominoes under PR pressure more than anything else.
Click to expand...

I don't think anyone expected all 10,000+ American banks and credit unions to be on board any time soon. That's totally unrealistic. Besides, for a lot of them implementing it would never make sense; for instance, maybe their customer base skews much older than average and doesn't keep up with technology. Maybe their fraud rates aren't bad in the first place. Or their customer base is predominantly Android and will be implementing only Android/Samsung Pay.

Besides, the best Apple Pay experience is if you use a credit card (no forced PIN entry). There are much fewer FIs issuing those, and likely cover nearly everyone who has an iPhone at this point.

kdarling said:
Any increased spending is likely very tiny in comparison to the loss of bank accounts being moved.
Click to expand...

The point I was making is that banks are choosing to do Apple Pay because there's a financial benefit for them. Whether that's by a decrease in fraud costs (US) or by making it easier for people to use cards more often. If there wasn't a benefit, no bank, even in the US, would have said yes to them.
 
MacRumors said:



During today's earnings call for the fourth fiscal quarter of 2015, Apple CEO Tim Cook announced a partnership with American Express that will bring the Apple Pay to customers in "key global markets."

Under the partnership, Apple Pay will be available to eligible American Express customers in Canada and Australia later this year, and access will expand to Spain, Singapore, and Hong Kong beginning in 2016.

apple-pay-800x500.jpg

Since its launch in the United States in 2014, the international rollout of Apple Pay has been slow. Customers in the United Kingdom gained access to Apple Pay in July, but aside from the U.S. and the UK, Apple Pay has not yet expanded to additional countries.

It is not clear when other banks and credit card companies in Australia, Canada, and other above listed countries will begin accepting Apple Pay, making the initial Apple Pay rollout in those countries somewhat limited.

Article Link: Apple Partnering With American Express to Bring Apple Pay to Canada, Australia, Spain, Singapore and Hong Kong
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I have no intention to pay apple (by using pay apple (a.k.a. apple pay)) for using their HW (phone). apple is making too much profit already with its overpriced HW. that is also the reason why I am only installing/using free apps from the apps store. apple is like a moocher...
 
Ever since this announcement, I've kept my eyes peeled and have asked every retailer (in Toronto) where I've made purchases over the last week if they accept American Express. The verdict: all of them so far.

Not an exhaustive list but off the top of my head:
Shoppers Drugmart
Sobey's
Hudson's Bay
Subway sandwiches
Home Sense
Cineplex movie theatres
7-Eleven
McDonald's

The only place that while accepting Amex, didn't have NFC terminals was Hudson's Bay but I understand that this varies by store and soon they'll all be equipped.

So, given this early impression, I feel that Apple Pay with American Express has a sufficient acceptance rate at popular retailers to become my main form of payment. As the Amex partnership is promoted by Apple, I think that more and more retailers will begin accepting it.

Let's wait and see what happens when the date is announced. If banks aren't a part of the initial rollout, they'll quickly see that an increasing number of their customers will begin spending on their AMEX cards where banks don't make a cut and they'll have to give in and bring Apple Pay to their bank debit and credit cards.
 
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Now, playing Devil's Advocate: what if banks dig their heels in and refuse to roll out Apple Pay? And what if the AMEX deal isn't practical for all purchases?

Is it feasible for a Canadian to move their money into a US bank? I really like the idea of Simple Bank. It's all online anyway. Can I open an account there or do I need a US address?
 
ipedro said:
Now, playing Devil's Advocate: what if banks dig their heels in and refuse to roll out Apple Pay? And what if the AMEX deal isn't practical for all purchases?

Is it feasible for a Canadian to move their money into a US bank? I really like the idea of Simple Bank. It's all online anyway. Can I open an account there or do I need a US address?
Click to expand...

If the banks dig in we still have Amex. :)

Move money to a US bank for Pay - No.

If you want a US based account try HSBC you can switch money effortlessly, get credit and debit cards, no fee ATM withdrawals at any bank and cheques. Also, you can get accounts in other countries.
 
ipedro said:
Now, playing Devil's Advocate: what if banks dig their heels in and refuse to roll out Apple Pay? And what if the AMEX deal isn't practical for all purchases?
Click to expand...

this deal isn't talking about the bank-issued AMEX cards - it's AMEX's own cards, so banks won't play any part in the decision.
 
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Can anyone explain why the Starbucks app have this in their app even when it is not yet available? If I try to enable it though it brings up Apple wallet...could this be a sign..?

ImageUploadedByTapatalk1446631916.290592.jpg
 
Yea but I'm in Canada and every thing about Apple Pay is quiet or non existence except for the AmEx partnership..even so they said is "coming soon"
Let me rephrase it could this mean Apple Pay is actually going to be announce not only the partnership with AmEx but with the big 5 banks in Canada as well?
 
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What I'm wondering is if Apple is going to have any formal announcement about Apple Pay.. Presently, apple.com has the /apple-pay page (as does apple.co.uk) so I'm wondering if we'll have apple.ca/apple-pay and apple.com.au/apple-pay or if because they're not really partnering with banks (that we know of) if they'll just quietly start allowing us to add our Amex cards.
 
I suspect we will have a formal announcement with the next iOS update enabling us to register the cards.
 
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