Apple’s recent announcements included the presentation of Apple Pay; the company’s attempt to move in to the payment processing space and encourage consumers to pay without the need to have a physical card. Apple is betting it will persuade consumers that Apple Pay is the way to conduct business in the future. We’re not so sure.
Don’t get us wrong: we love Apple’s products and its ability to transform markets. But consumers are hard to shift in behaviour. They may feel uneasy about a credit or debit card’s security, but they worry more about the unknown.
What online consumers like about payment processing
It may be true that consumers hate the vulnerability of credit and debit cards, but they have got used to this. They understand there are numbers and magnetic strips that could compromise their payment processing security. But they also understand how to help protect that security.
Fraud and theft of card details happens because of the system of payment processing, not because of the tools. Apple Pay will use the same payment processing process: payment details need to be authorised. Merchant accounts accept payments in. Merchant services and account providers are connected with card providers exactly the same. In other words, the scope for security breaches is no different.
Chip and Pin to Win
There have been plenty of attempts at replacing cards, none of which have been received with widespread popularity. The chip and pin security method has been around in Europe for a decade, but resisted in America. Apple Pay has been introduced at just the time when chip and pin becomes necessary for US retailers. In October next year, retailers will take on liability for fraud if EMV is not used to verify card payment. Chip and pin is the keystone of EMV security measures.
Payment processing won’t change because of Apple Pay. Consumers simply don’t change payment behaviours so easily