Many Retailers Hesitant About Offering Support for Apple Pay

[MacTCE]

That's 0.15%, not 1.5%.

Correct. Sorry I fat fingered the decimal point.

 

[kds1]

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.

Looks like someone fell asleep during the keynote, and never read up on what he missed.....

 

[six2pel]

I find it quite disturbing when companies employ significant resources to resist change.

I think many of them will eat crow in 2015 after the responsibility shift.

Just think, It wasn't that long ago when people thought using your smartphone as a boarding pass at the airport was dumb.

Even better, remember that online bill pay idea back in the days....yeah that'll never catch on.

 

[tmiw]

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.

Could be hedging their bets in case CurrentC doesn't work out? Large retailers probably get enough of a discount at the volumes that they buy that it doesn't matter either way. Plus if CurrentC flops they can probably push a software update within a month or two that turns on NFC and then proudly announce that they support Pay now. Conveniently after everyone's forgotten about CurrentC too.

 

[SirLance99]

This is all about making the iPhone more indispensable while also causing a hassle for anyone switching to Android.

How exactly? Since both the iPhone 6 and all Android phones can make NFC payments at the EXACT same places.

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You forgot to mention that Apple's implementation is far easier and more secure than any other that's been created before though.

It's not easier. Both Apple Pay and Google Wallet take the same amount of time to use.

 

[MacTCE]

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.

The banks would absolutely and gladly pay Apple their .15% if it helps eliminate fraud. Do some Googling and see how much Visa and MasterCard spend on fraud each year.
Also I'm curious to know where you saw or read Apple's .15% was coming from retailers.

 

[SirLance99]

Confused:

The Best Buy where I bought my 6 case had NFC terminals. They can't deny the use of my iPhone's NFC... It's just like having a chip in the actual card. Right??

I'm confused why they are saying "no" to Pay

They aren't activated

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I'm not sure that having NFC hardware is enough. I think the retailer also needs to have some software changes to deal with passing tokens to the institution and such. So I think there will be NFC terminals that don't accept Apple Pay.

False

 

[dontwalkhand]

There are many places that will take NFC and most won't know it. For example at Whole Foods and Bashas there isn't a contact less symbol or anything. It just says slide card.

Tap your card to the screen anyway and four green circles show on the screen, and the transaction went through (tested with my WF card).

This is a problem. The retailers themselves don't even advertise they take NFC! No Normal person will know that because it's a Verifone MX915 terminal it'll take NFC.

 

[TT D'arby]

This is interesting and something I wasn't really aware of. I kind of assumed that Apple Pay, while using NFC, still needed special backend stuff to work.

If this is the case, moving forward should be possible and helped that installing NFC capabilities in stores isn't an Apple only thing.

-Kevin

True! Definitely a cognizant layout on Apple's part and something unbeknownst to many. I'll be enabling my iPhone 6 everywhere virtue takes me..........be it the mall or McDonald's!

 

[coolspot18]

You need to stop saying this. It's wrong.

Tokenization happens at a different layer and has nothing to do with the terminal.

Perhaps I should have worded it at the payment processor level - the terminal (network) needs to have knowledge of the Visa Token Service or MDES to successfully process the payment. It will be interesting to see what happens if the local institution (i.e. payment gateway) does not support tokenization.

I think this will be a problem internationally or if the merchant uses a smaller, less well known network.

 

[rbgaynor]

How exactly? Since both the iPhone 6 and all Android phones can make NFC payments at the EXACT same places.

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It's not easier. Both Apple Pay and Google Wallet take the same amount of time to use.

Tap and pay isn't really on all Android phones though, they have to be recent, have a US SIM, and include a secure element for storage. I think Google's website only lists 2 supported phones in fact, although I suspect that may a couple of months out of date.

TouchID for device login and payment authentication will make using Apple Pay pretty frictionless.

 

[Nanotyrns]

Oh.. you again...

I think that many retailers will get on board simply because of the number of phones out there that support it. I feel like the same thing happened with the iPad and flash-dependent websites. If you wanted to be seen on any of the millions of iPads being sold, you had to abandon flash. And many websites did.

Think about it-- how many iPhone 6/6+'s have been sold so far? Even if only half of those owners want to use Pay then that's still 5 million or more consumers that will start to gravitate towards retailers that support it.

I'm going to research retailers in my area that will offer it and try to patronize those first. My debit card got compromised in the Jimmy Johns security breach so I'm on board with Pay in the hopes that it won't happen again.

 

[coolspot18]

It's ok as long as you don't allow fallback to the card number. I think that once the U.S. moves away from our current insecure system, c&p will be a huge hacker target.

I don't think chip cards have been compromised overseas yet ... so they're quite secure. However, yes, fallback is always a weakness, but this usually requires a special override or "secret" menu access. So it'll require a bit of social engineering on the fraudsters side.

 

[tmiw]

Tap and pay isn't really on all Android phones though, they have to be recent and include a secure element for storage. I think Google's website only lists 2 supported phones in fact, although I suspect that may a couple of months out of date.

TouchID for device login and payment authentication will make using Apple Pay pretty frictionless.

Plus the screen has to be on and unlocked on Android for NFC to work IIRC. I think you just need your finger/thumb on the sensor for Apple Pay.

 

[coolspot18]

What do you mean when you say local network?

The domestic processing network ... i.e. Visa Canada versus Visa USA. Also, the bank which has issued the terminal.

 

[T-Will]

McDonald's owns Chipotle. How can Chipotle not be on board?

They're not invested in Chipotle anymore.

I hope Chipotle changes their mind and gets on board to help me inhale chicken burritos faster than ever before.

 

[tmiw]

I think that many retailers will get on board simply because of the number of phones out there that support it. I feel like the same thing happened with the iPad and flash-dependent websites. If you wanted to be seen on any of the millions of iPads being sold, you had to abandon flash. And many websites did.

Think about it-- how many iPhone 6/6+'s have been sold so far? Even if only half of those owners want to use Pay then that's still 5 million or more consumers that will start to gravitate towards retailers that support it.

I'm going to research retailers in my area that will offer it and try to patronize those first. My debit card got compromised in the Jimmy Johns security breach so I'm on board with Pay in the hopes that it won't happen again.

I'm keeping track of retailers that support chip cards here, actually. There's also an option when you view/add a listing for whether NFC/contactless is supported. Feel free to update it when you run into places that support chip cards (and possibly NFC as well).

 

[SirLance99]

They will jump in eventually, It hasn't even been rolled out yet so hold on and see.

There has never been a better time for businesses to upgrade their POS to enable NFC payments.

Like many here mentioned Apple is not starting the contactless payment revolution as many people already use Google Wallet and contactless cards, Apple (whether many here like it or not) just made a lot of noise and WILL CHANGE how fast this will be adopted, particularly with the new upcoming regulations in the US.

Now for the rest of the world Apple Pay will spread like wildfire as NFC/Contactless is already been well received.

I don't get why so many people want to see Apple fail in every new endeavour and come here to attack Apple fans or just people using Apple services so viciously.

Pretty much right on all accounts. People have been using NFC payments for a while, be it Google Wallet or others. Adoption has been slow but that's, unfortunately, how the US is. With Apple in the game, FINALLY, it will expedite adoption.

I can't wait to use Apple Pay as I already use Google Wallet everyday. This is exciting for me.

 

[coolspot18]

they didn't really invent a new one. it's compatible with most NFC registers?

It requires a supported payment network to handle the tokenization. Currently only American Express Direct, Chase Paymentech, First Data Compass, and GPN will support Apple Pay.

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Tap and pay isn't really on all Android phones though, they have to be recent and include a secure element for storage. I think Google's website only lists 2 supported phones in fact, although I suspect that may a couple of months out of date.

Or done through a secure SIM like in Canada.

 

[SirLance99]

Tap and pay isn't really on all Android phones though, they have to be recent and include a secure element for storage. I think Google's website only lists 2 supported phones in fact, although I suspect that may a couple of months out of date.

TouchID for device login and payment authentication will make using Apple Pay pretty frictionless.

Let me rephrase it as I didn't make it clear enough, which was my fault. Sorry.

Any Android phone that had KitKat 4.4 will work. All Android phones sold for the last several years have NFC but as we all know, not all Android phones have the latest update.

Although, any Android phone sold now does.

Google Wallet is just as frictionless. It takes less than a second to make mine go through.

 

[lawrencewinkler]

Speaking from experience of working in the retail marketing space, the single biggest reason why it'll be quite a long time before NFC/Apple Pay is ubiquitous, is because of cost. People seem to think it's as easy as flipping a switch to support a new payment format. It's not. It requires an upending of the point-of-sale infrastructure. Not that they shouldn't invest in the future, but it's an EXTREMELY expensive endeavor. It's tough enough for some retailers to even change the way their receipts print out. Changing the kinds of technologies they accept for payment...

We've got a long road ahead of us.

The incentive for retailers to change is quite harsh. If by October 2015, retailers will be wholly liable for credit card fraud. Guess what retailers are going to be targets of stolen credit cards? These retailers are going to pay twice -- once by not being paid for the purchases made, and a second time when they cave by having to buy the new equipment.

 

[suprakc]

I figured there would be many retailers that would LAG on this. It's not a security hesitance, either. It's laziness and cheapness by major companies. I mean, why install hundreds of thousands of dollars worth of new tech when you can get by with the old?

Well, truth is, stores that haven't implemented apple pay within the next year (i.e. by iPhone 6s release - yes I am waiting...), I will find alternatives. If you can't offer it, Ill go next door to the person who does. Not only is it more convenient, but insanely more secure (hem hem Target, Home Depot, uhh.. we lost all of your credit card information to some hacker...)

So let's get with the program slowpokes!

 

[SqB]

Right! 1-2 more high profile hacking schemes. 1-2 cleverly placed articles about how Apple Pay users are completely unaffected. Apple begins printing money with Steves picture on it.

Could have been Google wallet. Wasn't. Could have been PayPal. Wasn't.

 

[Peace]

The retailers I frequent and my bank will support Apple Pay so I don't care.

 

[SirLance99]

The retailers I frequent and my bank will support Apple Pay so I don't care.

You mean they support NFC payments which includes Apple Pay and Google Wallet along with the others.