Last year, we wrote about the importance of Apple Pay and the potential for mobile payment to revolutionise retail. Since then, the technology’s rise has been quiet but rapid. With little fuss, mobile payment has gained a significant foothold with retailers and consumers alike thanks to its speed and ease of use, both of which are critical in today’s fast-paced society. But can that foothold translate into an increase in users and revenue for Apple Pay and other companies looking to branch out into mobile payment?
First the bad news. Going into last year, Apple CEO Tim Cook vowed that 2015 would be ‘The Year of Apple Pay’, and while significant movement was made, that promise simply didn’t happen. Apple Pay doesn’t have the ubiquity at the moment to lay claim to such a statement and according to Apple’s CFO Luca Maestri, it doesn’t provide a “meaningful financial contribution” at this point either. That question of revenue is a significant one, and in many ways the future of mobile payment depends on how well it can be answered.
Promise and potential is undoubtedly there though. During a second quarter earnings call, Cook confirmed that Apple Pay is “growing at a tremendous rate” and the facts back that claim up. Apple Pay is accepted at 10 million contactless locations across the six territories it’s currently available in (US, UK, Canada, Australia, China, and Singapore), with 2.5 million of those being in the United States alone. The technology is dealing with around five times the volume of transactions it was when it was introduced, and it’s servicing an estimated 1 million users every week.
These are great signs for Apple, but also for consumers, who have taken to cashless payment so strongly over the last few years that a recent survey found that over a third of the British public expect cash to be extinct by 2031. What’s more, nearly three quarters of those surveyed believe that cashless, contactless, and mobile payment will become so prevalent in a period of just five years that by 2021 there’ll be no need to carry cash at all.
Pippa Gluncklich, CEO at Starcom who commissioned the survey, said: “The way we spend, save, invest and earn is being disrupted by new technologies and innovations at a rapid pace. In fact, this survey shows that the vast majority of Brits believe cash will become obsolete, if not extinct, in the near future. This supports a wider trend we are consistently seeing where innovation around mobile wallets, wearable tech and biometric payments is fast transforming the traditional view and relationship between cash and shopping.”
The switch is more significant than a simple transformation in habits though. The link between cash and shopping has been waning since the introduction of the credit card, and now the rise of mobile payment is cutting the link between shopping and credit cards. The old adage that you “don’t leave home without” your credit card (or loyalty card, or any other kind of physical card) isn’t true any more; it’s only true of your mobile. And if retailers and technology companies want to take advantage of that inseparable connection, Apple Pay and mobile payment as a whole is the way forward.
What about you? Have you used Apple Pay? Let us know in the comments below or via social media.