UP AND COMING: ApplePay is gaining traction because of its simplicity and biometric security features.
Despite being in existence for just eight weeks and only being available as a feature on three of the company's smartphones, Apple's digital wallet is catching up with PayPal and Google Wallet in the US.
According to research broker ITG's research, 1% of digital payments made by US consumers in November were conducted with ApplePay. In the same month, Google Wallet, which has been available on both Android and iOS devices for almost three years, only accounted for 4% of transactions.
ITG's data also shows that 20% of all ApplePay transactions (accounting for 28% of dollars spent via ApplePay) were made at Whole Foods. Walgreens (19%) was the second most popular retail destination, followed by McDonald's (11%), Panera Bread (6%) and Subway (3%).
PayPal is currently the most popular mobile payments service in the US but ITG is enthusiastic about how quickly ApplePay is being adopted, and highlights the service's ease of use as a major advantage it has over its competitors' offerings.
As well as charting which retailers are the most popular ApplePay destinations, ITG's data also covers usage patterns and shows that 60% of consumers that use ApplePay are already using it on multiple days. Compare that with PayPal where only 20% of US consumers signed up to the service used it on multiple days over the same period.
ITG claims that ApplePay is getting used more often because of its simplicity and because of its baked-in biometric security -- payments are validated by a fingerprint scan. However, iPhones are premium devices bought by consumers with the largest levels of disposable income whereas PayPal is offered on all mobile platforms.
It is still very early days for ApplePay in terms of both adoption rates and retailer support. It is only available in the US and is only accepted at stores with the latest generation point of sales devices. However, Apple is planning to roll the service out in Europe at some point in 2015 and analysts believe that interest and excitement around ApplePay will help to kickstart the mobile payments market in general.
In its most recent report, published on Oct 28, Juniper Research forecasts that the Apple effect will lead to 500 million consumers adopting contactless payments via their smartphone by 2019. — AFP/RelaxNews 2014
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