Apple Looks Overseas for 2016 Apple Pay Growth
With Apple Pay growth in the United States having been somewhat sluggish since its 2014 introduction, Apple is looking to Asia and Europe for the contactless payments system’s growth in 2016. The service, which lets consumers pay inside an app or via their iPhone or Apple Watch at merchant point of sale terminals, will be introduced next year in China, Hong Kong, Singapore and Spain.
Apple is counting on its brand recognition as it enters markets that are further along than the US in all things mobile payments, particularly in advanced technologies needed to accept them in retail outlets. Still, it won’t be easy. The iPhone maker will compete with local banks and Internet companies that already offer the service – not to mention Samsung Electronics Co., the world’s leader in smartphones.
“There’s a lot of opportunity for Apple because their brand has a significant cache,” said Thad Peterson, a senior analyst at Aite Group told The Times. Apple’s challenge will be “to see if there’s going to be an adoption curve significant enough to justify the investment.”
Although Apple’s CEO Tim Cook called 2015 “The Year of Apple Pay,” the service has been slow to expand its footprint, mainly due to a lack of store terminals that can accept it. Growth has been faster in the United Kingdom, where more merchants have come on board.
Apple recently announced it is teaming up with China UnionPay to bring Apple Pay to China. In addition to Union Pay, 15 other banks, including the Bank of China, Bank of Shanghai and Bank of Guangzhou, have signed on to support Apple Pay. “China is an extremely important market for Apple,” Eddy Cue, Apple’s senior vice president of Internet Software and Services, said last week.
Apple has also expanded Apple Pay to Canada and Australia, albeit as an American Express-only service at the moment, due to a reluctance on the part of banks there to allow Apple to take what they consider to be a substantial piece of the payment pie via fees.