Apple partners with American Express to launch Apple Pay in Australia and Canada in 2015, 3 more cou

Posted:
in General Discussion edited October 2015
Apple will partner with American Express to launch Apple Pay in Australia and Canada by the end of the year and Hong Kong, Singapore and Spain over the course of 2016, CEO Tim Cook revealed during a quarterly conference call on Tuesday.




Mentioned almost in passing, the upcoming rollout is a major boost for Apple Pay's international availability, which until now has been limited to the U.S. and the UK.

According to Cook, the partnership will bring Apple Pay to Australia and Canada by the end of the year, though specifics are unknown. For example, it is unclear which card issuing banks are on board to offer support, if any. Interestingly, TD Canada Trust bank accidentally revealed upcoming Visa compatibility earlier this month, suggesting support for other credit cards are in the offing.

After substantial uptake at launch, Apple Pay adoption rates have slowed over the past year, studies show. Apple is trying to boost those numbers by extending availability to hundreds of banks in the U.S. It was announced on Tuesday, for example, that Kohl's will be the first store-branded credit card to join up with Apple Pay.

Comments

  • Reply 1 of 18
    bigdobigdo Posts: 17member
    I have been waiting for Apple Pay to come to Canada. American Express will work for me but I hope BMO joins as well. In Toronto , tap-to-pay terminals are very common which will help with adoption. I also wish Apple Pay becomes an alternative to the transit Presto Card for fare payments but I have a feeling this is not going to happen anytime soon.
  • Reply 2 of 18
    slurpyslurpy Posts: 5,321member

    American Express? What about VISA and Mastercard, the most commonly used cards here? I don't get it. 

  • Reply 3 of 18
    mstonemstone Posts: 11,510member

    That is one way to get around stubborn banks. AMEX is not bundled with traditional merchant gateway accounts. They run their own ecommerce service, at least in the US.  Not sure about AU and CA.

  • Reply 4 of 18
    mstonemstone Posts: 11,510member
    Quote:
    Originally Posted by AppleInsider View Post



    According to Cook, the partnership will bring Apple Pay to Australia and Canada by the end of the year, though specifics are unknown. For example, it is unclear which card issuing banks are on board to offer support, if any.

    Banks don't issue AMEX. You get the cards directly from American Express. Same with the payment processing, AMEX processes their own transactions completely separate from any bank or merchant gateway. 

  • Reply 5 of 18
    Quote:
    Originally Posted by mstone View Post

     

    That is one way to get around stubborn banks. AMEX is not bundled with traditional merchant gateway accounts. They run their own ecommerce service, at least in the US.  Not sure about AU and CA.


     

    To be correct, most, but not all, Amex cards are issued by Amex as the bank. BofA and Citi issue some cards.

     

    Amex processes through a traditional gateway account. As a merchant, you send the transactions to, say Chase Paymentech, First Data or Stripe, like you do for Visa.

     

    However the difference is that Amex acts as the acquiring bank for most but not all merchants. Amex receives the money from the issuing bank (usually itself) and deposits it into your bank account. A business that accepts Amex will receive payment from a "normal" acquirer for Visa/MC/Discover but Amex separately for their transactions.

  • Reply 6 of 18
    djsherlydjsherly Posts: 1,031member
    Quote:

    Originally Posted by mstone View Post

     

    That is one way to get around stubborn banks. AMEX is not bundled with traditional merchant gateway accounts. They run their own ecommerce service, at least in the US.  Not sure about AU and CA.


    It gets the product on the ground here but I know very few people with AMEX, and if they have it, it's generally corporately issued.

     

    Tap and Go is becoming ubiquitous here. Not sure (apart from not having to carry a physical card) where Apple pay is adding value here when it comes to ease of use.

  • Reply 7 of 18
    brucemcbrucemc Posts: 1,541member
    Amex might be little used, but hopefully will kick the big 6 into action.
  • Reply 8 of 18
    Amex? Who the heck uses Amex in Australasia?

    They must have had some serious pushback from the banks here.
  • Reply 9 of 18

    Groan

     

    6.5% of Americans have an American Express card, so it likely lower in Australia...

     

    great success, not.

     

    Of course in Australia it lets them bypass the banks and gives them a teeny bit of traction to keep ApplePay adoption growth growing

  • Reply 10 of 18
    slurpy wrote: »
    American Express? What about VISA and Mastercard, the most commonly used cards here? I don't get it. 

    lostkiwi wrote: »
    Amex? Who the heck uses Amex in Australasia?

    They must have had some serious pushback from the banks here.

    Groan

    6.5% of Americans have an American Express card, so it likely lower in Australia...

    great success, not.

    Of course in Australia it lets them bypass the banks and gives them a teeny bit of traction to keep ApplePay adoption growth growing


    Interestingly, TD Canada Trust bank accidentally revealed upcoming Visa compatibility <a href="http://appleinsider.com/articles/15/10/13/bank-website-accidentally-teases-upcoming-apple-pay-launch-in-canada">earlier this month</a>, suggesting support for other credit cards are in the offing.
    .

    The fact that TD accidentally published details about Visa support through their bank (as stated in the article) would imply that the small hint Tim dropped about Amex support is just that, a small hint. Maybe he did it to motivate the big banks to get on board, maybe it's just that Amex will be ready to go by the end of the year and the other banks are due to follow or maybe he just wanted to release some minor details now and they will release more info closer to the date when they know which banks are on board.

    I wouldn't go assuming Amex is the only option just because no one else has been called out by name yet.
  • Reply 11 of 18
    Quote:
    Originally Posted by cy_starkman View Post

     

    Groan

     

    6.5% of Americans have an American Express card, so it likely lower in Australia...

     

    great success, not.


     

    Wrong metric. Comparing US credit cards, Amex is bigger in dollars charged than MasterCard. They are 3 times bigger than Discover and are the 3rd largest credit card lender in the world (1 and 2 are Chase and BofA). Amex has fewer cards, but much greater spend. Like Apple, they go for the high-end.

     

    You have to compare by money charged, not by number of cards.

     

    ETA: It's 20% in Australia added with Diner's Club. US credit market, I think they're roughly 30% alone.

    http://fsi.gov.au/publications/interim-report/02-competition/payments-sector/#P260_48540

  • Reply 12 of 18
    At that pace it's rather a crawl-out than a roll-out :/
  • Reply 13 of 18
    djsherlydjsherly Posts: 1,031member
    Quote:

    Originally Posted by konqerror View Post

     

     

    Wrong metric. Comparing US credit cards, Amex is bigger in dollars charged than MasterCard. They are 3 times bigger than Discover and are the 3rd largest credit card lender in the world (1 and 2 are Chase and BofA). Amex has fewer cards, but much greater spend. Like Apple, they go for the high-end.

     

    You have to compare by money charged, not by number of cards.

     

    ETA: It's 20% in Australia added with Diner's Club. US credit market, I think they're roughly 30% alone.

    http://fsi.gov.au/publications/interim-report/02-competition/payments-sector/#P260_48540




    Problem in AU is Amex's fees are higher for the merchant than Visa/MC and merchants here are more than happy to pass it on as they're legally allowed to do. For those places which do accept it, the surcharge on the purchase in 3-5 percent compared to 1% for Visa/MC. Diner's card is basically a rounding error.

     

    the other problem apple pay is facing they want the same terms as in other jurisdictions, even though the interchange fees in Australia are typically half that in the US. That, on top of pretty much zero extra convenience as tap and go has been a thing here for years  means that Apple pay is having a tough go of it here.

  • Reply 14 of 18
    djsherly wrote: »

    Problem in AU is Amex's fees are higher for the merchant than Visa/MC and merchants here are more than happy to pass it on as they're legally allowed to do. For those places which do accept it, the surcharge on the purchase in 3-5 percent compared to 1% for Visa/MC. Diner's card is basically a rounding error.

    the other problem apple pay is facing they want the same terms as in other jurisdictions, even though the interchange fees in Australia are typically half that in the US. That, on top of pretty much zero extra convenience as tap and go has been a thing here for years  means that Apple pay is having a tough go of it here.

    The fees Amex is charging doesn't seem to be an issue for Amex. They're not trying to compete with Commonwealth or ANZ. Tim didn't say that Amex would be the only one to support Apple Pay so we will have to wait and see what other options are available at launch or soon after.

    It's only been rumoured that Apple has asked for the same terms/fees as in the US. This may not be the case at all. Apple likes to roll these things out gradually and make sure they are done right. Having Apple Pay rolled out to 4 countries a little over 12 months after it launched is faster than they have rolled out some services in the past such as iTunes Radio. Maybe they haven't been having any real issues at all getting the support of the banks here in Australia. It may just be that Apple wasn't yet ready to expand into a new market.

    Also, ApplePay isn't just about the convenience of not having to pull a card out of your wallet. Sure, tap and pay is simple but it's not as secure as Apple Pay. It doesn't incorporate tokenisation like Apple Pay (granted that may not be as much of an issue here where merchants haven't had huge data breaches as has been the case in the US) and there is no security on smaller transactions that don't require a pin compared to Touch ID as used in Apple Pay.

    I don't expect Apple Pay will be huge here in Australia right away as many people won't understand the benefits. I'm sure over time though the number of users will grow here as consumers begin to understand the benefits.
  • Reply 15 of 18

    I don't know about NZ banks, but Australia's 4 big banks guard their profits with attack dog-like ferocity.  They just increased interest rates off their own bat because the Government increased the amount of cash they must keep on hand in case of another GFC.  Instead of funding it out of their gargantuan profits, they chose to slug us instead.  So they probably aren't keen to share anything with Apple.

     

    I was planning to switch my mortgage next year.  The availability of Apple Pay might influence where I go next.  It won't be the deciding factor, but it will surely be one if everything else is equal between two choices.

  • Reply 16 of 18

    Hey, Wonko.  Bought any toothpicks lately?

  • Reply 17 of 18
    djsherlydjsherly Posts: 1,031member
    lolliver wrote: »
    The fees Amex is charging doesn't seem to be an issue for Amex. They're not trying to compete with Commonwealth or ANZ. Tim didn't say that Amex would be the only one to support Apple Pay so we will have to wait and see what other options are available at launch or soon after.

    It's only been rumoured that Apple has asked for the same terms/fees as in the US. This may not be the case at all. Apple likes to roll these things out gradually and make sure they are done right. Having Apple Pay rolled out to 4 countries a little over 12 months after it launched is faster than they have rolled out some services in the past such as iTunes Radio. Maybe they haven't been having any real issues at all getting the support of the banks here in Australia. It may just be that Apple wasn't yet ready to expand into a new market.

    Also, ApplePay isn't just about the convenience of not having to pull a card out of your wallet. Sure, tap and pay is simple but it's not as secure as Apple Pay. It doesn't incorporate tokenisation like Apple Pay (granted that may not be as much of an issue here where merchants haven't had huge data breaches as has been the case in the US) and there is no security on smaller transactions that don't require a pin compared to Touch ID as used in Apple Pay.

    I don't expect Apple Pay will be huge here in Australia right away as many people won't understand the benefits. I'm sure over time though the number of users will grow here as consumers begin to understand the benefits.

    The added security is technically great but practically worthless so long as banks cover you for fraudulent transactions. There's the other issue of ID theft which is a privacy issue which Apple Pay has well covered. But even then nearly all my pos interactions have had me in possession of the card at all times, Including an upscale restaurant where the machine was brought to my table.

    It's a great idea for me. I'd love to be able to get around with just my phone. I hope it gets bigger.
  • Reply 18 of 18
    anomeanome Posts: 1,464member
    Quote:

    Originally Posted by lostkiwi View Post



    Amex? Who the heck uses Amex in Australasia?



    They must have had some serious pushback from the banks here.

    Well, for one, I do. And I'm looking forward to using Apple Pay. It will probably lead to me using my AmEx more than my Visa.

     

    Quote:


    Originally Posted by djsherly View Post





    The added security is technically great but practically worthless so long as banks cover you for fraudulent transactions. There's the other issue of ID theft which is a privacy issue which Apple Pay has well covered. But even then nearly all my pos interactions have had me in possession of the card at all times, Including an upscale restaurant where the machine was brought to my table.

    Different experience to me, where I keep having servers in restaurants take my card, and then ask if it's OK to "Paywave" (one of the trademark terms), failing to see that the point of tap and go is that I hold on to the card at all times. (I always say no if they've taken my card, because lecturing them on the proper way to handle the situation is a sure way to get them to spit in your food next time you come in.) So, I kind of like the fact that Apple Pay Tap'n'Go won't work if I'm not holding the phone. (Although I did have one person snatch my phone out of my hand, when I was getting the QR code for their loyalty program scanned.)

     

    Also, the added security is exactly why the banks should be in favour of this. I understand if they think the interchange fees are too high, after all banks are money-grubbing bastards, but the cost will be offset by a reduction in credit card transaction fraud.

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