With Apple Pay now confirmed to launch on Monday, we are closer to seeing the impact it will have on mobile-payments acceptance, technologies, and standards.
In the meantime, much of the debate concerning Apple Inc.’s payments venture has missed a crucial point. While the discussion has centered on whether Apple Pay will energize mobile payments and the ecosystem for near-field communication (NFC), it is far more important to consider that Apple Pay is merely a component of Apple’s Passbook app, and then to evaluate what the Apple Pay/Passbook combination could mean for the future of payments.
At first glance, it appears that Apple has positioned itself in alignment with the rest of the payments ecosystem to reinvigorate mobile payments. However, in the greater Passbook context you can see that, by positioning itself alongside the payments ecosystem, Apple has greatly bolstered its potential as a payments disruptor.
The key is Passbook. Through Apple Pay, Apple has incorporated the major payment brands and the largest issuers into Passbook, thereby legitimizing Passbook as a wallet. Apple and its payments-network and financial-institution partners have already begun to aggressively promote Apple Pay in an effort to make Passbook a central payments decision point for consumers.
Digital Transactions, October 16, 2014
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