Apple has been quietly putting together a plan to blow open the mobile-payments industry, making major deals with credit-card companies in a move that could threaten the dominance of PayPal and other mobile-payment companies.
These deals could make Apple the go-to source for mobile payments.
Baird Equity Research published a note saying eBay and its PayPal unit were directly threatened by Apple’s impending launch of a mobile-payments system on iPhone 6:
For years, Apple was seen as the “elephant in the room” with respect to mobile and online payments, and the source of speculation around the presumed launch of a consumer payments “iWallet.” While there is no shortage of competition in payments, we view Apple as perhaps the most legitimate potential threat to PayPal’s strong position – particularly with respect to growth opportunities at point of sale.
Reports claim Apple has signed deals with three major credit-card companies: American Express, Mastercard, and Visa.
One of the biggest problems with mobile payments has been the sheer number of different apps and services needed to pay for the things you buy every day. Between the Starbucks mobile app, Venmo, Square, Amazon, and PayPal, most users need to download, install, and hand over their card data to a variety of companies. But if Apple has united three major cards together, then it could save users a ton of time by letting them go to one place to make mobile payments.
Nearly A Billion Existing Customers
It’s not just credit-card agreements that could make Apple’s rumored iWallet a major player in mobile payments. The company already has a vast amount of credit card information, with Bloomberg reporting that there are over 800 million iTunes accounts, the majority of which have credit-card information associated with them. Apple has proved over a number of years that consumers trust it with their card data, and that it can manage a thriving ecosystem. Whether it’s the App Store or iTunes, people are used to handing over their credit-card information to Apple.
TouchID
There’s a secret weapon in Apple’s mobile-payments arsenal, and that’s TouchID. Apple’s fingerprint sensor, first introduced with the iPhone 5S in 2013, provides an extra layer of security for the iPhone by requiring users to place their finger on the home button to scan their fingerprint. It’s a neat trick for everyday usage, but combine — For more information read the original article here.
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