Apple Pay Dominates Mobile Payment Platforms, Coming to Vending Machines [Updated]

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Apple's mobile payment system, Apple Pay, is only about three months old, but already accounts for the lion's share of wireless credit card payments. The iPhone and iPad maker said Apple Pay currently accounts for more than two thirds of contactless payments.

Apple Pay dominates mobile payment platformsApple Pay dominates mobile payment platforms

Apple CEO Tim Cook said during the company's first fiscal quarter earnings report on Tuesday afternoon,

Three months after launch, Apple Pay is more than two out of three contactless payment dollars across all networks. For merchants who already accept Apple Pay, rates are even higher.

Mr. Cook said that 80 percent of mobile payments at Panera Bread come from Apple Pay. Grocery retailer Whole Foods has seen a 400 percent increase in contactless payments.

Those numbers are expected to climb even more once Apple Watch ships this April. Apple Watch is Apple's smartwatch device, and will include Apple Pay support. Once the watch hits store shelves, Apple Pay will expand beyond the iPhone 6 and iPhone 6 Plus to include the iPhone 5 and iPhone 5s.

Apple Pay will soon be available in over 200,000 self service places, including retailers, vending machines, parking meters, and more. That will come thanks to a partnership with USA Technologies, a company that specializes in small payment self-service terminals.

USA Technologies is no stranger to wireless payment support. The company started adding NFC support to its cashless payment systems ten years ago, and has seen growing interest in the feature. NFC, or Near Field Communication, is the technology Apple, Google, and others use to handle wireless credit card transactions from smartphones.

"We anticipate that the millions of consumers who frequent these locations will appreciate the convenience and security of using Apple Pay for their everyday purchases, and we believe that Apple Pay will help to drive additional sales for our customers," said USA Technologies CEO Stephen P. Herbert.

Mr. Cook said point-of-sale suppliers are seeing an unprecedented demand from merchants for Apple Pay-compatible transaction terminals, too.

Apple reported US$74.6 billion in revenue and earnings at $18 billion for its first fiscal quarter for 2015. iPhone sales hit 74.5 million units, coming will about analyst 69 million unit estimates.

Mr. Cook added, "We are more convinced than ever that 2015 will be the Year of Apple Pay."

[Updated with additional information about USA Technologies]

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Comments

aardman

Apple has corralled the most affluent, highest spending segment of the consumer market.  It should not be any surprise that getting merchants to adopt ApplePay is not a hard sell.

geoduck

I do wish they had said something about Apple Pay expanding into other countries.

BurmaYank

@geoduck - did you see this?

Apple Pay May Be Expanding to Canada as Soon as March - MacRumors/Mitchel Broussard (Jan 9, 2015):

“Apple Pay has been exclusive to the United States since its launch last October, but it now appears Apple is preparing to take the mobile payments service international with an expansion to Canada as soon as this March. Citing sources “close to the situation,” 9to5Mac reports Apple is currently in negotiations with Canadian partners, preparing and planning various promotional materials over the next few weeks for use during the upcoming launch.

Apple and Canadian launch partners are in the process of planning advertising and other promotional material for March, which indicates that the launch could come as soon as then. Of course, these are still active discussions and it’s possible the talks could fail to result in a launch by March. Several sources, however, tell us Apple is currently targeting that timeframe.
International expansion of Apple Pay has been the subject of several rumors in recent months, but Apple has yet to make any official announcements about its plans. Apple Pay has, however, been growing steadily in the U.S. since its October launch, adding new banks, credit unions, and retail partners at a steady rate.

Rumors of a March launch for Apple Pay in Canada fall in line with the current rumor of the Apple Watch launching in the same month, although it is unclear whether Canada will be in the first wave of launch countries for Apple Watch as Apple’s Canadian website says “Available in 2015” while the company’s U.S. site mentions a more specific “Coming Early 2015.” With the Apple Watch capable of supporting Apple Pay payments, however, it seems natural for Apple to be pushing forward on international expansion of the payments service as the watch’s launch approaches.”

BurmaYank

So, would-be ApplePay users in Canada, & iPhone 5S users in the US, now seem to be waiting together for the combined AppleWatch/ApplePay (next version) launch in April (instead of March).

geoduck

BurmaYank
I did catch that when it came out. I’d like to have gotten something a bit more official than a Macrumors retelling of a 9to5 Mac story from someone close to the situation. Even TC saying “We plan to expand to other countries and markets in the near future” would have been nice.

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