Many Retailers Hesitant About Offering Support for Apple Pay

[rbgaynor]

Oh, really. So that 1.5% is coming out of the bank's profit?

The banks are in a line of business where they will pay out more in expenses to operate a service than they make from operating the service?

Of course the retailer is going to pay it. The bank isn't going to give up any money to Apple just because their customer (the retailer) chooses to play nice with Apple.

It's just 0.15%, not 1.5%. The banks see value in greatly reduced chance of fraud. I know my Bank, tiny little Wells Fargo, is falling all over themselves to tell me they will be supporting Apple Pay as soon as it's available. The even run ads on their ATMs.

 

[MyopicPaideia]

MCX retailers are responsible for 25% of all retail spending, however. I don't know how much people spend at places that support NFC currently.

That's fine, but that means that 75% of all retail spending goes to non-MCX retailers. The vast majority of this 75% will be upgrading to POS terminals within the next couple of years that will support NFC payments in addition to the mandated Visa/Mastercard EMV Chip reading capability.

I mean I can imagine a scenario where CurrentC wins out, but it seems like an unlikely alternate universe where the masses for some reason decide they want to abandon an internationally and virtually universally accepted form of payment for a US only method that requires them to completely change the way they pay for things...and then only for 25% of their spending.

 

[Grolubao]

I believe the problem is that they don't want to install POS that are only Apple compliant. They want to support multiple platforms and Apple Pay is closed.

 

[ApfelSchaf]

lol

 

[SqB]

I believe the problem is that they don't want to install POS that are only Apple compliant. They want to support multiple platforms and Apple Pay is closed.

Step 1: read thread
Step 2: edit poorly informed post

 

[Crzyrio]

I believe the problem is that they don't want to install POS that are only Apple compliant. They want to support multiple platforms and Apple Pay is closed.

Apple Pay actually uses standard technology. A LOT of which is already out there, so when they install a POS for Apple Pay, almost every other phone will be able to take advantage of it along with numerous other cards.

Apple Pay is just different in terms of software and security.

 

[spectrumfox]

I get your point, but I keep emergency cash on me for just such an occasion, especially when traveling. Even attendantless gas stations have a machine that accepts cash.

Good thing cash will never go out of style.

 

[ececlv]

Liability Shift

Liability Shift doesn't mean what you think it means.

Fraudulent transactions will still be the responsibility of the retailer, no matter if the retailer upgrades or not.

The liability shift is about legal liability. Visa and MC will give retailers a "safe harbor" from liability law suits. Whether or not this safe harbor actually means anything depends on how good a retailers lawyers are as it is not a law, just something the credit card companies claim they will provide.

 

[tmiw]

That's fine, but that means that 75% of all retail spending goes to non-MCX retailers. The vast majority of this 75% will be upgrading to POS terminals within the next couple of years that will support NFC payments in addition to the mandated Visa/Mastercard EMV Chip reading capability.

I mean I can imagine a scenario where CurrentC wins out, but it seems like an unlikely alternate universe where the masses for some reason decide they want to abandon an internationally and virtually universally accepted form of payment for a US only method that requires them to completely change the way they pay for things...and then only for 25% of their spending.

That assumes that retailers will install NFC enabled terminals. It's completely possible to buy chip enabled terminals that don't support NFC, and a fair number of smaller business probably will go that route. We have to keep in mind that the US is only going to chip because it has to (there's too much fraud now not to unless people want to stop using cards entirely), not because anyone particularly wants to. Lots of businesses will go the cheapest possible route, and if they think that it's going to be easier and less expensive to sign up with MCX and install new software than the difference between the non-NFC and NFC enabled chip readers...

 

[SqB]

Good thing cash will never go out of style.

I hope we can find something to agree on before this thread dies out. Lol. This isn't going to be it. Having fun though.

 

[six2pel]

american express has been around forever and isnt accepted everywhere. what makes apple think it can come in and do an exponentially better job?

Although a valid question, not at all germane to the topic. Apple is offering a different technology. American Express did not and charged higher rates.

Not really the same thing, is it?

 

[spectrumfox]

That's always the difference between Android phones and the iPhone: Android users look at what the phone can do. iPhone users look at what the user can do. How many Android users are using their phones to make purchases?

Say what? o_o

Both Android and iPhone users who have phones with NFC capabilities will both now be able to make NFC payments at registers that support it. I don't see the difference you are trying to point out.

 

[gnasher729]

Is this true? How does that work?

Because we have these terminals everywhere in the UK.

Visa, Eurocard, American Express or whoever is behind your credit/debit card has to upgrade the computers in their data centre to accept the data that comes from Apple Pay. The NFC terminals that you find all over the place don't need to be changed.

Right now, if you use your card, your card sends a message to the NFC terminal "this is Sheza's card", the terminal sends the message to Visa, Visa replies "that card is fine", the terminal accepts payment.

With Apple Pay, your phone sends a message to the NFC terminal "this is an Apple Pay card with some secret token", the terminal sends the message to Visa, Visa detects that the token belongs to Sheza's card and replies "that card is fine", the terminal accepts payment.

The story is that this should start working some time in 2015.

 

[MyopicPaideia]

You'd be surprised to learn that MC and Visa are already onboard.

Here

I think you misunderstood me. I meant that Visa or Mastercard will never be using CurrentC. Of course I know that they are kn board with Pay. That's the basis of my argument...

 

[spectrumfox]

I hope we can find something to agree on before this thread dies out. Lol. This isn't going to be it. Having fun though.

What fun are forums if everyone agrees with each other though?

 

[donnaw]

Succesful companies have a way of being surprisingly agile when profits and loss are at stake.

But large companies simply cannot be that agile. Sorry, been there, done that. It just doesn't happen with outfits like Best Buy or Costco.

However, with the new CC regs I'm sure this has been on most companies radar for a while. My guess, most will implement at the last possible moment. Just in time to avoid liability moving into their corner. And I suspect most will turn on the NFC component too. But it certainly will take a few years before you can leave your credit cards at home.

One more thing though, I do predict that within a decade banks won't even issue actual cards. I'm betting that by then everything will be electronic. Either you will use a phone or some 'bank issues' device that uses the same type of tokenization. And my grandkids (who are 10 and 7) will probably just have an implanted chip. And I'm not joking either.

 

[gnasher729]

Say what? o_o

Both Android and iPhone users who have phones with NFC capabilities will both now be able to make NFC payments at registers that support it. I don't see the difference you are trying to point out.

You don't get it, right? With Android we here "the phone can do this... the phone can do that..." But nobody is actually using it. Android phones don't bridge the gap between what the phone can do and what the user can do. Apple doesn't concentrate on what the phone can do, but what the user can do.

 

[DotCom2]

Good to see the quality of the american education is as strong as ever. Maybe if you learned a bit about economics your economy wouldn't be collapsing.

Excuse me for not following? Look at my public profile and try again.

Are you calling me uneducated because you can't get your head around the fact that the merchant is not paying Apple (nor is the merchant getting the cost passed on to them by increased processing fees in any way shape or form), but in fact the financial institution that issued the card is?

Just ignore him. If he were as educated as he thinks he is, he would know that our economy is not collapsing. And if it did, it's not because of lack of education.
It's because of GREED>

 

[SqB]

Agree with the idea, just not the timeframe.

Also, no chips. Just DNA/Biometric reading. Reading DNA will be as easy as reading a fingerprint soon.

 

[iJandro]

give 'em a couple years, they will be persuaded...nobody says no to apple...nobody

 

[kds1]

american express has been around forever and isnt accepted everywhere. what makes apple think it can come in and do an exponentially better job?

AMEX is not accepted everywhere because of the higher fees they charge retailers to accept the card.

 

[IJ Reilly]

It says gas to make it clear that it is referring to BP Gas Stations not accepting Apple Pay at the current point in time.

No matter what you meant to convey, BP is still an oil company, not a gas company. As it says in the quote in the article, BP doesn't even own any gas stations. If the goal is clarity, then just say that for now Apple Pay won't be accepted at BP gas stations. Simple, direct, accurate.

 

[rbgaynor]

Say what? o_o

Both Android and iPhone users who have phones with NFC capabilities will both now be able to make NFC payments at registers that support it. I don't see the difference you are trying to point out.

The difference is that Google's implementation has been out for some time yet has barely moved the needle as far as NFC payment usage/acceptance in the US. Time will tell, but I suspect most of us here expect Apple Pay to have a rather profound impact on use/acceptance.

 

[MyopicPaideia]

That assumes that retailers will install NFC enabled terminals. It's completely possible to buy chip enabled terminals that don't support NFC, and a fair number of smaller business probably will go that route. We have to keep in mind that the US is only going to chip because it has to (there's too much fraud now not to unless people want to stop using cards entirely), not because anyone particularly wants to. Lots of businesses will go the cheapest possible route, and if they think that it's going to be easier and less expensive to sign up with MCX and install new software than the difference between the non-NFC and NFC enabled chip readers...

That's fair enough, but your assumption is that the NFC enabled Chip reading POS terminal is more expensive than a non-NFC enabled one. Or at least more than marginally more expensive. Just look at Best Buy and Walmart. They have POS terminals that are NFC capable but have turned it off. If it was so much more expensive to get those terminals over non-NFC models, why did they spend money on something they weren't even going to use? Heck there are even posts on here on other Pay threads reporting that there are plenty of Walmart stores around the country where the NFC functionality is actually working now, despite the companies official stance on it! Weird indeed,

The only businesses that would go this route are small mom and pop sorts of outfits anyway, they wouldn't be any of the big retailers. I am pretty confident that within 3 years NFC will be accepted at places where over 75% of all retail spending occurs.

 

[spectrumfox]

The difference is that Google's implementation has been out for some time yet has barely moved the needle as far as NFC payment usage/acceptance in the US. Time will tell, but I suspect most of us here expect Apple Pay to have a rather profound impact on use/acceptance.

You don't get it, right? With Android we here "the phone can do this... the phone can do that..." But nobody is actually using it. Android phones don't bridge the gap between what the phone can do and what the user can do. Apple doesn't concentrate on what the phone can do, but what the user can do.

How do you guys know no one is using it? Your points are anecdotal at best.

Google Wallet allows users to do everything Apple Pay does. They are two different ways to accomplish the same task: to pay with your smartphone.

Apple has a bigger footprint in the US, but companies who weren't on board with NFC before aren't suddenly going to change their minds now that Apple is doing it.

Not to mention the only iPhones that can do NFC are the 6 and 6+. There are many two-year contract users who are still using 5s' and below that won't upgrade for another year at least.