I've been plenty vocal, both on a local and corporate level. Thus far, it hasn't helped. The locals have no clue and the corporate offices don't seem to give a damn.
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Apple Pay Gains Nearly 60 New U.S. Banks and Credit Unions
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I've been plenty vocal, both on a local and corporate level. Thus far, it hasn't helped. The locals have no clue and the corporate offices don't seem to give a damn.
Well in this specific example what benefit would the extra expense provide to an employee cafeteria? I mean, presumably cafeteries on a whole don't experience much credit card fraud. But a cafeteria whose only customers are employed by the company in which it is located? I would think almost none.
Mike
I share your frustration re: Vodafone and general 4G availability. Until July last year Ashbourne (Derbyshire) was stuck on GPRS. Trying to use a smartphone on a legacy network was nothing short of annoying (and yes I know there are more important things in life!)
I've not really use WiFi Calling yet (there's an issue surrounding SMS I believe?) and given they've been testing VoLTE long enough at their HQ in Newbury I'd have thought it'd be about ready by now (same goes for LTE-A; I've only ever seen it once outside the Houses of Parliament!)
Barclays have been touted as saying "early 2016". Given they were one of the first banks to implement contactless payments you'd have thought they'd have been one of the first to jump 'on board'.
It's about just getting up to the regulations and providing a consistent experience for card dipping rather than swiping. Even then, at least bring NFC capabilities to the table.
It's disappointing that merchants are slow to adopt, but then the average joe isn't aware or have taken your point of view.
I've used Apple Pay a few times and it's really an awesome process, you would think that all merchants would want to have that kind of experience when shopping at their stores. But then it cost money to invest in these systems, it would be better that Apple provides some type of help to reduce the cost.
I obviously do not know what Apple is doing behind the scenes, but perhaps publicly Apple can express some statement on what they are doing to apply pressure or help in the matter. I mean, to entirely blame it on merchants doesn't help matters when Apple can do something as well to help with adoption.
Why should merchants adopt Apple Pay when there's just a select few that take advantage of it.. It's Apple service, shouldn't they provide some assistance as well. Now, I do know enabling NFC also helps Google as well... But I think Apple is more valuable to NFC simply because Apple users are more likely to use it.
That's a good point, to a degree. I read an article a few months ago that discussed how many businesses were not spending the money to upgrade their systems because their historically fraudulent transactions were less than the cost of buying new equipment. The management of most of them stated that they would just wait until they needed to upgrade their systems for other reasons, and make the shift then.
However, like the OP I am perplexed about any business manager who would spend the money to upgrade their system and not put NFC and EMV in place.
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I agree that we don't know what Apple is doing behind the scenes. But given the number of partners who were ready to go at the beginning, both merchants and banks, and the number of banks and issuers who have signed up since I would say they are likely beating the bushes pretty hard.
Hopefully they will do something to entice more merchants to get on board. And I am not unsympathetic to the mom and pop store who just doesn't have the margins to replace all of their hardware in quick order.
But the most frustrating examples of non-participation to me are the merchants who have NFC terminals in place, but refuse to make them active, and the merchants who are proactively trying to undermine Apple Pay in order to push their less secure, less consumer friendly models. Those are the merchants for whom I reserve my most scathing comments/feedback.
I think everyone here is severely underestimating how horrible the credit card industry is. I work for a credit card processor. Everything is held together with baling wire and a prayer.
To give you an idea, here are the hands a transaction passes through with a normal processor. First, you swipe the card in a terminal. Chips and NFC tokens are effectively the same as a swipe for this purpose. The terminal at the store takes it and hands it to the terminal vendor. The terminal vendor takes it and hands it to the store's selected processor. The processor hands it to the card brand (Visa, Mastercard, AmEx, &c.). The card brand hands it to the issuer. The issuer hands it to the backing bank. All of these parties get your card data, and they can all be different people. It's an enormous string of middlemen.
None of the banks handle settlement in the same way. Each issuer talks to their set of backing banks and presents one unified interface to the card brands, but each issuer's interface is different. The card brands all talk to their issuers using whatever the issuer wants, then they each present a completely different protocol to the processors. The processors talk to all of the card brands, but they all have a different interface for the terminal vendors. There are huge numbers of deals and contracts involved. The EMV rollout in the United States is going far, far faster than I expected.
As an aside, the security issues in EMV are nightmarish. The chips can be cloned. Chips on stolen cards can be locked open in a way that causes most terminals not to check if the card has been stolen. After working for a credit card company and seeing how little people actually care about keeping cardholder data private, I've switched to using cash for everything I can.
These ARE credit cards. The named banks or credit unions issue credit cards to their customers or members. It may be branded "MasterCard" or "VISA", but the credit line backing that card is provided by the issuing bank.
Not everyone banks at a big national institution like Chase or Wells Fargo. Even though I do, I still keep a local credit union account open because they have the best terms for auto loans.
And I'm tired of reading this same complaint from people that are willfully ignorant about credit card transaction processing. Apple isn't involved in transactions once you have added a credit card to your Wallet.
Apple had what amounted to a co-marketing agreement when Apple Pay was first announced. But, as you may not realize, the merchants didn't specifically support Apple Pay. All they did was install NFC terminals at the point of sale, and they had already done so to support contactless cards and the impending requirement for chip readers.
You should talk to your bank. They are the ones that are holding out.
If your bank doesn't listen to you, get an American Express card. It may not be universally accepted in Canada, but if you use it when you can, and every other Apple iPhone user does the same, your bank WILL notice when their credit card transaction volume shrinks.
One of the major appeals of Apple Pay is privacy. Apple isn't involved in transaction processing, and what you propose would effectively give Apple information about every transaction conducted via Apple Pay.
Apple could offer to subsidize the cost of NFC point-of-sale terminals, but the incremental cost for a terminal supporting NFC is a relatively small portion of the total cost. Depending on the transaction processor used by the merchant, there are recurring costs for contactless, Apple Pay, and Google Pay transactions. Once again, subsidizing those costs would provide those transaction details to Apple.
Well either way I just won't see it as a must have feature. Not something I would upgrade for and such.
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I think most of us know how bad the credit card situation is like. But what are we to do, honestly? Apple will just continue to do whatever makes them happy. I'm all for more secure way of payment but honestly there isn't much we can do.
If Apple is able to take .15 for every $100 in spending from the banks, then they can certainly give the merchants .10 per $100 for signing up for Apple Pay.
Apple is able to determine the usage of Apple Pay in stores somehow--that's how they're able to take a cut from the bank and determine the % of people actually using it.
I think you are missing something important:
The mandate for the switch to chip cards was not the result of "regulations". It is being driven by the merchant agreement with VISA, MasterCard, etc.
The merchant agreement essentially says: If someone uses a chip card to make a purchase, but has to swipe it because the merchant only has a mag-stripe reader, then the merchant is responsible for any fraud.
As the OP pointed out: a company cafeteria isn't likely to experience any significant level of credit card fraud. So, they are willing to take the risk, instead of investing in a new point-of-sale terminal.
This "business decision" is being repeated across the US. Frankly, I'm surprised at how many merchants are accepting the risk, but I don't know their historical cost of credit card fraud or how much it costs to replace/upgrade their point-of-sale terminal.
It has nothing to do with a "consistent experience". And NFC support is optional. It's an extra cost feature, and depending on the transaction processor, the additional cost may be recurring rather than a one-time investment.
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I think you misunderstand the likelihood of fraud.
In the US, banks are heavily regulated, and audited frequently. A violation of their contract with Apple would be uncovered quickly, without any effort by Apple.
Apple would be stupid to extend that same courtesy to merchants, without detailed information from the merchant. And, the merchant would likely be unable to provide it anyway: remember that an Apple Pay transaction looks exactly like an contact-less card transaction to a point-of-sale terminal.
That's the same thing as a regulation.
I am the OP.
All it's going to take is for one large merchant to feel the sting of a data breach before the domino effect happens. If other countries don't have a problem implementing NFC, then we shouldn't.
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Indeed they are. However, the banks take a cut of every card transaction, so all Apple would have to tell the banks to do is give back 10 cents of every $100 on an NFC/Apple Pay transaction, and then Apple would just give the banks a discount for whatever they pay out to the merchants. Something can be done if you think it through properly.
This will collapse unless small merchants or more of any kind of merchant sign up. The only merchant in my area that uses AP is Rite Aid and I go every day to buy something to support AP but that's sad. OK, the Apple Store uses AP but I'm rarely there. I asked at the Apple Store where they use AP and a woman said she went to the Winn Dixie grocery store to use AP but that's not near me.
My wife's dress store has an Apple fan (has Apple everything) employee and she is trying to convince the owner to get AP. Surprisingly, Apple has a group dedicated to promoting & implementing AP in small merchants but nothing's happened yet. My wife promised to buy more stuff if they would get AP.
My wife's dress store has an Apple fan (has Apple everything) employee and she is trying to convince the owner to get AP. Surprisingly, Apple has a group dedicated to promoting & implementing AP in small merchants but nothing's happened yet. My wife promised to buy more stuff if they would get AP.
Are they demanding the last 4 digits of the DAN for just Apple Pay, or are they demanding the last 4 digits of the card number for EVERY transaction?
We shop at Tom Thumb, which is part of Safeway. (Safeway is a competitor of Albertson's, at least in my state). They ask for the last 4 digits of the card, no matter which one I use. And the last time I was there, even the chip reader was still deactivated and there was a sign that said "please swipe chip cards".
I think this is an attempt to prevent cloned card fraud, because some terminals (not necessarily Safeway/Tom Thumb) actually say: "please show card to the cashier". But, they usually just ask for the last 4 digits anyway. This may prevent someone from copying the magnetic stripe from a stolen card to another card that looks legitimate, but is invalid. Is there someone in the credit card processing industry that can confirm?
If that's the case, it's just another instance where the infrastructure hasn't caught up with the technology. It's going to be a while before the US catches up with the rest of the world, and stops using security measures that were designed for mag-stripe cards.
You'd think whoever directed someone to place that sticker there should've went, "why are we still having people swipe their chipped cards?"
Nah, American's are just dumb and most don't even realize there's a chip on the card... And if they do notice, they don't know what it's used for... And if they do know what it's used for (not most people), they don't know how to use it.
In the US, "regulation" usually means "a rule or order issued by an executive authority or regulatory agency of a government and having the force of law". Of course, YMMV.
It's already happened. That's one of the reasons I'm surprised Target is so resistant, as they took a serious hit to their bottom line a couple of years ago. We haven't shopped there since except to take advantage of a big sale on a specific gift item, and we paid cash.
It's not the "country". It's the merchants, and to a lesser extent: the issuing banks. One of the reason NFC was quickly adopted in Canada was the elimination of secondary authorization (PIN or signature) for small amounts.
That was a decision by the banks (about 5 of them dominate the industry in Canada) to encourage credit card usage for small amounts at fast food and coffee merchants. I don't know if the merchants received incentives to upgrade to NFC, but they certainly benefit simply by shaving a few seconds off every transaction.
Banks in other countries have done the same. But, the US simply doesn't have an oligarchy of banks that can move the market in that direction. And as I've pointed out before, processing an NFC transaction actually costs more at some transaction processors in the US. Hopefully, that will change, but that's the domain of the transaction processing networks (the middlemen between the merchant and the issuing bank).
It would have to be on Apple Pay transactions, only. I doubt that Apple would be willing to pay 10 cents/$100 for contact-less card transactions in which Apple Pay was never used.
But, as you wrote, think it through properly: the bank doesn't pay the merchant directly. They pay the transaction processor. The transaction processor then pays the merchant, after deducting their contracted fee. For instance:
https://squareup.com/pricing
Square's pricing is simple: 2.75% for card-present transactions (which includes Apple Pay). Don't forget that they can't tell the difference between an Apple Pay and contact-less card transaction: only the bank knows that.
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And the answer is pretty simple: because they haven't yet enabled the use of the chip readers. That's a "business decision" made by corporate, not the cashier or the store manager. I'll guess that fraud at a grocery store isn't high enough to warrant a wholesale change at this time.
If that were true, there would have been no need to put up the sign and stop people from trying to insert the card.
If a chip reader is enabled, you HAVE to insert a chipped card. Attempting to swipe it will generate an error message, at least in the places I've tried. After doing that once or twice, I started looking for the slot.
I know this already.
I was speaking from the manager's or cashier's point of view.
This I didn't know. I thought the banks paid the merchant directly and then just took their 3% cut on credit cards, or 25 cent cut + 1% on debit cards or whatever.
Target already has chipped enabled terminals, so they're covered.
Here in the UK (at least) if the Chip is damaged somehow after three attempts it'll usually fall back to a signature.
I can't believe it'll be 10 years next month since Chip and PIN was "switched on" over here!
This is part of what I was getting at earlier with my list of middlemen. The card transaction flows through a huge number of hands, then the actual settlement of the charge flows through a number of hands that may not be the same. Everybody involved takes a tiny cut, and no two vendors filling the same role seem to accept transactions or settlement information in the same way.
The EMV transition is also definitely not being driven by regulation. There are certain Payment Card Industry (or PCI) standards, but these standards are not laws, and not everybody in the payment card industry has to follow them. For example, a card brand could opt out of EMV support entirely. They would just have to negotiate different terms with their providers and offer new terms to their customers. That's basically how gift cards work.
To get a new transactional system to work, you have to start on either the supply end or the consumption end. Gas stations have a huge advantage over electric recharging stations because they're already everywhere. People want more efficient cars, though, and electric drivetrains help improve efficiency. The result of this was hybrid cars. Once there is some kind of standard for electric vehicle charging and the charging stations are common, hybrid cars will be rapidly discarded by their manufacturers.
Apple is working on building a huge number of suppliers-of-money (people who buy things) who are able to use Apple Pay. Once they have that, it will be feasible for more consumers-of-money (stores) to use Apple Pay to consume it. They have to start somewhere, and that's the most logical place to start. It's like the opening of the App Store, but slower, because it depends on the glacial pace of the banking and payment card industries.
Well, I've been nagging my bank ever since Apple Pay was announced. Now that they're finally on board, I plan to use Apple Pay every chance I get.
I agree with others who say that the logjam at this point appears to be on the merchant side; there need to be more NFC terminals that allow for Apple Pay. The merchants, obviously, might be enticed by some financial incentive on Apple's part. But that might open a whole can of regulatory worms, as if Apple were bribing the merchants.
Some comments:
1) People forget that in countries that use chip cards, it took YEARS to get to the point that most merchants accepted them.
It also took a while for the consumers to get used to them. For example, one of the documented problems with chip rollout in Canada, was that people forgot their PINs at first.
Even now, UK surveys show that the further one gets from London, the less likely people are to trust and use contactless transactions.
2) Apple's greed is greatly to blame for banks not wanting to partner with them. Apple does nothing during each contactless transaction, but still wants a percentage of each purchase. Paying Apple would cost twenty times what it costs banks in contactless fraud, so there's little fraud incentive to support Apple Pay in countries where contactless payments are common.
3) Apple users are to blame, too. US banks signed on, not wanting to be behind when contactless transactions took off. Instead, only about 15% of people who could, tried Apple Pay, and only 1/3 of those continue to use it. One estimate is that there's only about a few million US users who pay with it fairly constantly... mostly for small purchases.
Upshot: patience. Adoption of new things rarely happen overnight. Anywhere.
1) People forget that in countries that use chip cards, it took YEARS to get to the point that most merchants accepted them.
It also took a while for the consumers to get used to them. For example, one of the documented problems with chip rollout in Canada, was that people forgot their PINs at first.
Even now, UK surveys show that the further one gets from London, the less likely people are to trust and use contactless transactions.
2) Apple's greed is greatly to blame for banks not wanting to partner with them. Apple does nothing during each contactless transaction, but still wants a percentage of each purchase. Paying Apple would cost twenty times what it costs banks in contactless fraud, so there's little fraud incentive to support Apple Pay in countries where contactless payments are common.
3) Apple users are to blame, too. US banks signed on, not wanting to be behind when contactless transactions took off. Instead, only about 15% of people who could, tried Apple Pay, and only 1/3 of those continue to use it. One estimate is that there's only about a few million US users who pay with it fairly constantly... mostly for small purchases.
Upshot: patience. Adoption of new things rarely happen overnight. Anywhere.