Why 2015 may not be the year of Apple Pay after all, say retailers

A survey of the top 100 U.S. retailers suggests Apple won't meet its goals with Apple Pay this year. Some of the reasons are valid while others seem like sour grapes.
Written by Kevin Tofel, Contributor

While Apple expects half of the top U.S. merchants to accept Apple Pay in 2015, retailers themselves don't think that goal is likely.

In report released on Friday, Reuters noted that less than a quarter of the 100 merchants, as recognized by the National Retail Federation, currently accept Apple Pay. Of the remaining retailers that don't use Apple's digital payment system, two-thirds say it won't happen this year.

There are a few reasons why. One is that there are still competing payment platforms, such as CurrentC, which will launch later this year at WalMart and 18 other retailers. And those that accept CurrentC won't be able to use Apple Pay due to exclusivity agreements.

Another challenge for retailers is less information captured on customers at the point of sale: 28 of the surveyed companies feel want buying preference data and feel they can't get it from Apple Pay.

That seems more like an excuse to me, though.

The companies can surely track such data through inventory management at the store level; they simply don't get the consumer's credit card information at the point of sale with Apple Pay.

The cost of upgrading registers and sales terminals is another obstacle but again, I'm leery of that being a valid reason.

Many point of sale terminals were upgraded long ago to accept touchless transactions, for example, that work with credit cards containing an RFID or NFC chip.

And using that as an excuse suggests these companies aren't forward thinking when it comes to digital and mobile payments. The trend is happening so they'll have to have the equipment to support it, regardless of whether they accept Apple Pay, Google Wallet, CurrentC, or some other similar platform.

While the data suggests Apple may fall short of its expectation, as a payment platform Apple Pay seems to be doing just fine. More than 700,000 locations accept it; a quick build up since Apple Pay launched last year. And in the U.S, Apple's share of smartphones closed the gap on Android in the first quarter; adding even more potential users of Apple Pay.

That's a trend most retailers can't afford to overlook, even if they have mobile payment platform aspirations of their own.

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