What Is Apple Pay?

Topic: Payment News (Mon 14th Oct 2019)
Apple Pay picture

What is Apple Pay?
We have all been in that awkward situation where we are trying to make a purchase online or in a store, only to find our card is not in our wallet. Even worse, we have left our whole wallet at home and are now stranded with no access to cash or cards. With Apple Pay, this problem is eliminated. With the way modern society works, we are less likely to leave the house without our mobile devices, or Smart watch.

How Does Apple Pay Work?
Apple Pay utilises our reliance on smart devices, by holding card details in a secure cloud application. This app is accessed via our mobile device which replaces the physical card as a means of payment.
In other words, Apple Pay is a digital wallet. With Apple, the system works on iPhones and Apple Watches. Apple Pay is used to make in-app purchases by storing card details, including the CVV code (the three numbers on the back of the card), and expiry dates.

Once set up, any sale can be authorised by granting the Apple Pay app access to your biometric ID. These include fingerprint, face ID, or pin passcode. Once you have authorised Apple Pay to use these methods of ID, you can pay for goods and services using your biometric ID as a digital signature.

As a shopper, this makes the whole process a lot simpler. No more trying to find your card to get the Security numbers off of the back or find out the expiry date of your card. As long as you (or your customer) has access to an Apple device, a sale can be authorised simply and efficiently.

Newer Apple Mac models with Touch ID can use Apple Pay while purchasing online. On iPads with face ID or fingerprint recognition, Apple Pay is available within apps, on Safari, or within a business chat. You can add up to 12 cards per device. You are also able to use and store rewards cards in your Apple Wallet.

How Easy is it to use Apple Pay?
Apple Pay is as simple as the clicking of a button. It is the most efficient way to make payments. Security protocols are much higher than using a normal plastic card. If you lose a card, it can be used fraudulently. Your mobile device will require biometric ID to function and is therefore more secure. Apple hold all of the date on highly encrypted servers. This makes Apple Pay safer and faster than using a debit or credit card. Apple pay is widely used and accepted as well as being user centric.

Should I accept Apple Pay in my business?
There was a time in the not too distant past when shoppers switched on to using plastic cards. Nowadays, when you walk into a business that does not accept cards, or that has the archaic practice of charging a £5 or £10 minimum, (yes, they still exist), how do you feel? Technology is being adopted at a far quicker rate in our modern world. Whereas it took a few decades for plastic cards to become the norm, we can fully expect Apple Pay, and the android version, Google Pay, to be adopted much more quickly.

With over 380,000,000 users in more than 40 countries the potential customer base is vast. Statistically, Apple Pay users represent around 70% of the world’s card payment volume and around 90% of all mobile transactions. By not accepting Apple Pay, you could potentially start to see a drop-in revenue as customers who adopt the system favour retailers that do.

What is Apple Pays Main Demographic?
The top group (18-34 years-old) of Smart Wallet users is made up of just under half of all smartphone users worldwide. That is a huge number of potential customers.

From the remaining half of Smartphone users worldwide, 44% have a mobile wallet in the 35-44, age group. It will not be long before that tipping point sees this group adopting Smart Wallets if history is anything to go by. There is far less concern about security online among the 35-44 age group. Spotify, Netflix and other streaming services are normalising the consumption of media through the convenience of cloud services. It is easy to see how digital payment processes will follow suit.

Perhaps the toughest crowd, and potentially one of the last groups to abandon physical card payments in the future, are the 55 to 64-year-olds. Just under 30% of this group claim to have a mobile wallet.

In conclusion:
Shopping with Apple Pay is far more convenient for a customer. There is no longer a need to spend time searching for a wallet or finding the right card. When online shopping the benefits are even greater. When shopping online customers can check out with a single touch when making in app purchases, through safari or via payment portals. As many online purchases are made on impulse, Apple Pay reduces the time for “buyers regret” to set in. How many times have you changes your mind about a purchase while searching around for your card? Apple Pay removes that down time in the process.

For a retailer, Apple Pay is also far more secure. Traditional credit, debit, and prepaid cards are prone to fraud. Apple Pay transactions require Face ID, Touch ID, or a passcode. As Apple Pay does not rely on a card number, the level of sensitive data your company holds reduces.

A key benefit to the customer is that there are no additional fees when paying with Apple Pay. There is also no limit to transactions, unlike some debit or credit cards, which may only have a £30 limit.

The future is all about efficiency and sustainability. As a society we need to cut down on the use of plastic. Smartphones are certainly not the most environmentally friendly product, but they will no doubt win the popularity war with shoppers. With Fraud on the increase, the security of Apple Pay will also become more important to the consumer.

Get ahead of the curve, and look into Apple Pay now, and you won’t get left behind.

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