Fintech: US banks fall for temptation of Apple Pay
US digital infrastructure far from ready; alternatives to mobile payments here to stay.
Another 46 US banks signed up to Apple Pay in September. Apple’s mobile wallet platform, launched last October, has now signed up 500 of the country’s banks, including the largest – but have they made a mistake?
The US is the first country to receive Apple Pay but its retail payments infrastructure is the least supportive of advanced digital wallet technology. Apple Pay and the US banks may be ready to go, but “if only 5% of places in the US accept NFC then it’s not yet at the forefront of consumers’ minds when they go to a merchant,” says Thiago Olson, chief executive of payments card, Stratos.
Chip and pin technology has only recently started to take off in the US, and near field communication (NFC) capabilities that mobile phones use for payments depend entirely on this Europay, Mastercard and Visa (EMV) standard. While chip and pin technology was mandated in several countries as a means for faster payments with a lower risk of fraud in face-to-face transactions, fraud has been less of an issue in the US, and the cost of moving to EMV technology has been considered too high.
That opinion has now changed.