What is Apple Pay? Fad or future?
So many people are walking around today with their smartphones in hand, possibly not even aware of how very smart their devices have become. And many smartphone users are probably only using a fraction of the capabilities offered by their devices.
Take Apple Pay, for instance. You’ve probably heard about it, maybe even seen it in your passbook or considered using it, but haven’t yet taken the leap.
Well, in reality, using Apple Pay is more akin to a few simple steps rather than a leap. And the resulting experience is out-of-this-world exceptional––both for consumers and businesses.
Simple consumer setup
Apple Pay is the digital wallet that’s compatible with recent versions of Apple devices, including, but not limited to, iPhone (iPhone 6, SE and 7), iPad, Apple Watch, and MacBook Pro with Touch ID.
For simplicity sake, let’s assume you just bought a new iPhone. Well, Apple Pay is already installed in your Wallet app. No downloading is necessary to begin using it. And, whoever sold you your new Apple device will very likely assist in its rudimentary setup, including adding a passcode to secure your phone, as well as Touch ID, an individually unique fingerprint authentication. By the way, Touch ID also is one of the things that makes the Apple Pay digital wallet so easy to use.
Once Touch ID has been set up, Apple Pay setup takes, well, about one minute. And anybody can do it. No tech geeks needed. Here are the steps involved:
- Tap the Wallet app icon
- Touch the + sign
- Hover your phone over your credit card and––surprise! Your phone will capture an image of your credit card and its number and expiration date is documented onto a secure page (if not correct, you can manually enter the numbers)
- Type in your CVV code from the back of your card
- Your phone then sends the request to your card issuer
- Your card issuer verifies your card
- You agree to the terms between you and your financial institution
- Your credit card appears in your digital wallet and is ready for use
Repeat the process to add another card, and another. It’s amazingly simple. And super fast.
Purchasing securely with Apple Pay
Apple Pay truly does acts like a wallet when it comes to making purchases with your debit card and credit card data—only without the plastic. All of your payment information is securely stored in your new Apple device instead.
Using this digital wallet in-store is even easier than setup, taking only about one to two seconds to process a payment. Believe it.
Your smartphone and the business’ point-of-sale terminal or system (POS) communicate securely via near field communications (NFC), a type of radio wave that transmits data between the two devices when in near proximity, such as 1-3 inches. That’s why a simple wave or tap near of your iPhone near an NFC-enabled POS will allows you to pay for your goods in a second.
While tapping, waving or holding your iPhone near the POS, simply place your finger on the Home Button, which also acts as the Touch ID sensor. This authenticates the purchase, since your fingerprint is unique and your iPhone knows it’s truly you. This is Apple Pay’s second layer of security, by the way. The third security layer is a chip built into the phone called Secure Element (SE) that uses tokenization to make the data indecipherable to hackers.
All of this security is happening in an instant because...voila! A “paid” note shows up on your phone’s screen, and your payment is complete. It’s so fast, you may be a bit taken aback the first time you use it. How can something so complex take a second or two to process?
Even EMV payments, which take security a step further than traditional magstripe cards, can take up to 10 seconds to process. If you’re a business owner or a customer, imagine the lines moving five times faster with Apple Pay. That’s what’s in our near future as more and more people adopt digital wallets.
With Apple Pay, customers will be happier, staff will be happier, store owners and operators will be happier. All because Apple Pay makes the payments process a smooth, seamless, fast experience.
Apple Pay and other digital wallets
Apple Pay is not the only name out there in digital wallets, however in the past year Apple Pay has been increasing its market share, its iOS operating system now at 42 percent in the United States. Over the past year and a half, Android’s operating system from Google, used on a variety of smartphone devices––even Samsung–– has grabbed almost 56 percent of market share. Android Pay is now Google’s digital wallet, having replaced Google Wallet a couple of years back. The future market share looks to be split between these two leaders: Android Pay and Apple Pay.
Businesses seem to have their own forecast for the future. According to Apple World Today, “Apple Pay has the largest percentage of supporting U.S. merchants with 36 percent accepting Apple’s mobile payment service, according to new data from Boston Retail Partners (BRP) That’s up from 16 percent in 2016.”
In addition, it seems about 20 percent of retailers plan to start accepting Apple Pay in 2017.
The hurdles, hoops and obstacles to Apple Pay?
Actually, the obstacles to Apple Pay are more perceived than real. You can’t imagine how easy it is to set up and use Apple Pay until you try it. Apple Pay, Google Android Pay, Samsung Pay and other digital wallet companies, along with large and small businesses, plus financial institutions and payments processors, have been working diligently over the past few years to launch digital wallets successfully and securely.
And the trends are slowly moving in the direction of digital.
Look for Apple Pay signs and decals at checkout in stores. But check this out, too: Apple Pay is also available in all kinds of apps, and on participating websites when you use Safari on your MacBook Pro with Touch ID. You can use Apple Pay in virtually millions of places.
In addition, approximately a thousand financial institutions––and the numbers are growing––are participating in and supporting Apple Pay.
Between advancing technology, business buy-in, financial institution participation, and the growth in digital wallet adoption by customers, the trend toward Apple Pay is moving from fad to future. As digital wallets progress, the experiences created are becoming beyond exceptional for both customers and merchants alike.