Apple Pay Crushing The Competition in the U.S. - Canadian Launch Still Uncertain
According to Apple CEO Tim Cook, Apple Pay now accounts for two of every three dollars spent on contactless payments on MasterCard, Visa and American Express.
On Apple’s Q1 earnings call Cooke said, “Apple Pay is off to a very strong start,” adding that he expects 2015 to be “the year of Apple Pay.” About 750 banks and credit unions participate in Apple Pay. While still in the “first inning” of its emergence, according to Cooke Apple Pay was already being used more than all of their competitors combined. In fact, Apple Pay was responsible for 80 percent of mobile payments at Panera Bread, and at Whole Foods, mobile payments increased by 400 percent.
Earlier information has also confirmed Apple Pay’s market success. Apple Pay had more than 1 million card activations 3 days after launchApple Pay was available, and by November, Apple Pay vaulted to 1% of all digital dollars spent.
Apple Pay is not yet available in Canada and Canadian credit card issuers still have no indication as to when it will be available. In an interview with PYMNTS, Linda Mantia EVP of Digital, Payments and Cards at RBC said ” until now we haven’t been able to talk to them about mobile payment. While the launch of Apple Pay is unknown in Canada, it is of major interest to the industry and a good thing for consumers; it provides an easy way to pay with a client’s credit or debit card.”
Apple Pay does have plans to expand internationally, and Canada is likely to be on the list along with the likes of China. Although Canada is a much smaller market than China, “there’s a good argument to say that Canada is a better suited environment for Apple Pay to launch, because we already have these tap-to-pay terminals installed throughout Canada, and we’re already using them,” said Brian Jackson, editor of ITBusiness.ca in an interview with the CBC. “It’s really a deal with the banks that has to be done.”
With the launch of several competing mobile payment products from the likes of RBC, TD and CIBC, it’s not clear the Canadian banks want to relinquish the playing field to Apple. Moreover, while Canadian retailers have indicated broad support Apply Pay if it improves the customer experience, Michael Leblanc of the Retail Council of Canada adds that “the other thing we look for is something that helps our operating costs and ultimately allows us to lower our costs to consumers. To us, Apple Pay seems to be another layer in the payment supply chain versus a competitive payment type.”
All that said, several industry insiders would not be surprised if Canadian banks were hiding behind smoke and mirrors, and Apple Pay launched in Canada sometime in 2015.