Apple in talks with UK banks to launch Apple Pay in early 2015
The international rollout of Apple Pay is likely to begin in early 2015, as Apple is said to be in talks with banks in the U.K. to debut its mobile payments service in the coming months.
Apple hopes to launch Apple Pay in the first half of 2015, according to The Telegraph which cited unnamed sources familiar with the ongoing talks. Negotiations are said to be "tricky," as at least one of Britain's biggest banks is reportedly reluctant to share too much information with Apple to launch its tap-to-pay service.
"It is understood the bank is uncomfortable with the amount of personal and financial information Apple wants to collect about its customers," the report said. "Some executives fear Apple Pay and the data it delivers to Apple could serve as a beachhead for an invasion of the banking industry."
Apple Pay has already gotten off to a blockbuster start in the U.S., where it launched in October and quickly became the largest NFC-based mobile payment service in a market where numerous competitors were already established. In November, Apple Pay accounted for 1 percent of all digital payment dollars.
Apple Pay is currently limited to the U.S., but job listings in both Europe and China suggest an international rollout is in the works. Apple has not given any specific launch windows for international availability, however.
Because Apple Pay relies on established near-field communication technology, users have found that they can already use the capability at some NFC terminals internationally. But the tap-to-pay functionality found in the iPhone 6 and iPhone 6 Plus is only operational if the device is set up properly with American credit cards.
But the fact that Apple Pay is already compatible with global systems highlights the fact that the international roll-out of Apple's mobile payments service is not hampered by technology or point-of-sale systems. Rather. Apple must forge agreements with banks and credit card issuers to ensure compatibility around the world.
Apple hopes to launch Apple Pay in the first half of 2015, according to The Telegraph which cited unnamed sources familiar with the ongoing talks. Negotiations are said to be "tricky," as at least one of Britain's biggest banks is reportedly reluctant to share too much information with Apple to launch its tap-to-pay service.
"It is understood the bank is uncomfortable with the amount of personal and financial information Apple wants to collect about its customers," the report said. "Some executives fear Apple Pay and the data it delivers to Apple could serve as a beachhead for an invasion of the banking industry."
Apple Pay has already gotten off to a blockbuster start in the U.S., where it launched in October and quickly became the largest NFC-based mobile payment service in a market where numerous competitors were already established. In November, Apple Pay accounted for 1 percent of all digital payment dollars.
Apple Pay is currently limited to the U.S., but job listings in both Europe and China suggest an international rollout is in the works. Apple has not given any specific launch windows for international availability, however.
Because Apple Pay relies on established near-field communication technology, users have found that they can already use the capability at some NFC terminals internationally. But the tap-to-pay functionality found in the iPhone 6 and iPhone 6 Plus is only operational if the device is set up properly with American credit cards.
But the fact that Apple Pay is already compatible with global systems highlights the fact that the international roll-out of Apple's mobile payments service is not hampered by technology or point-of-sale systems. Rather. Apple must forge agreements with banks and credit card issuers to ensure compatibility around the world.
Comments
Not sure what would be in your envisaged model after disintermediation? We the people with iPhone and ?Pay at one end ... ... you suggest banks be removed ... what is at the other end then? Credit card companies can go but banks? Or did you mean just bank credit cards not banks per se?
Once users seamlessly transition to using Apple Pay everywhere and for everything (I'm guessing it'll take 3-5 years) people will become very comfortable with Apple as a holder of all secure data. Apple Bank/Credit isn't really that big of a logical leap.
Oh I see what you mean ... Apple becomes the bank ... yes, I have suggested that for a long time.
And with their stock still growing massively it would be very easy for them to offer savings rates to customers that would easily leapfrog every bank and credit union out there.
I don't think they would do that otherwise they could have done that out of the gate with a solution more inline with Google Wallet. I think Apple has no such interest and will always keep the banks in control of the back end so they can garner further support for the sale of their devices.
It's really anyone's guess what Apple's endgame is at this point, however their hire to the Apple board of directors of the woman from Goldman Sachs...or was it Morgan Stanley (?) suggests to me that Apple making inroads in banking and investing isn't far off.
Can someone explain what this personal and financial information is? According to Apple when you use ?Pay Apple doesn't know what you bought, where you bought it or how much you paid for it. In Passbook I can see my most recent transactions but I'm assuming that is local to the device and not sitting anywhere on Apple's servers.
I'm with you on this one. I don't think Apple has any interest in becoming a bank just like I don't think they have interest in owning a record label or being a wireless carrier. What Apple is doing with ?Pay is right in their wheelhouse. It's low risk/high reward. ?Pay, like Touch ID is one of those things you might think is no big deal until you actually start using it. Then you never want to go without it again.
What personal data is the bank worried about? If it is an iphone6 user, Apple already has quite a bit of the user's data assuming the person has an itune account and has bought apps.
Most banks will eventually want to get on board for fear of being left behind and consumers switching to cards that work with secure and convenient digital payment option.
That bank in question probably didn't understand how itune and iphone work...
The situation's pretty different here in the UK. I was actually baffled when I read about Apple Pay, because it seemed to be exactly the same thing we'd had for years - it was only later I realised that US payment technologies are antiquated. Here, most recent credit and debit cards already support wireless payment.
?Pay uses the NFC technology for communication (which the US has had as long as the UK), but Apple has worked with financial institutitotions to make the process more secure for everyone involved.
The difference being that you don't pull out a card, you use the phone that's in your hand already, often at least. And then the Touch ID confirms that it's you holding the phone.
But you're right, payments have been antiquated here for quite a long time, and that's maybe why the chipped card is about to be leapfrogged. It's a classic reversal. When I first went to the UK and Europe in the late 60s, no one was using credit cards at all, and we found that astonishing. When Europe did jump in, they did so with more advanced systems than the US was stuck with. No surprise, but there is a lot of inertia in the way things are done here. But then when things change, they have to leap.
Tv followed a similar path back in the day. UK was far behind with color then PAL emerged and that leapfrogged (is that a word? lol) NTSC.
It doesn't say 'high amount', it could possibly be:
'It is understood the bank is uncomfortable with the low amount of personal and financial information Apple wants to collect about its customers.'
Obviously the bank knows how many times a customer uses their own cards but they get no data about their competition. Customers could be using a competitor's cards much more frequently and a bank would never know. That would match up with their fear that they'd take on a lower importance part of the payment process.
There's a possibility that Apple needs setup information from customers like name, address (for auto-filling shipping details), card and security numbers in order for the cards to verify through Apple Pay in order to prevent stolen cards being added but that wouldn't be any more than a standard online merchant, they'll have these details for hundreds of millions of people already.
When you use apple pay in the USA what do you see on your bank statement? Do you see the retailer named against the transaction or does it just say Apple? If the latter then the banks will kick off here because they are used to knowing where their customers send their money. Wonder if that is the translation of low amount of information?
I think you have hit the nail on the head there. Another contributing factor could be that other countries don't have the ridiculous amount of CC fraud that the US has and so banks might not feel the need for Apple Pay.
Apple is able to create strongly differentiated value to customers with secure, private, and easy to use Services. Apple's customers are the owners of Apple devices, Apple customers are not the product.
As Cook has said follow the money to understand the business model. While Services has cash flow, earning come from products sold.