Apple card pushes payment companies to up their mobile game
Apple recently announced the Apple Card, leaving many wondering: Why now?
Beyond its user-friendly key features like daily cash-back rewards, enhanced privacy and no-fee structure, the reveal of Apple Card signifies a larger trend happening in payments today—the rising adoption of mobile payments and wallets, a movement that’s expected to permanently alter the payments landscape.
While mobile payment adoption in the U.S. has been slower than anticipated, today, consumers are starting to make the move to mobile—justifying Apple’s expansion from just Apple Pay to the Apple Card. Driven by consumers’ expectations for a faster and easier payment experience, similarly, the payments industry needs to adapt to these evolving needs as this trend continues to grow.
In addition to announcing the Apple Card, Apple also disclosed a rise in Apple Pay transactions and acceptance—explaining that Apple Pay will reach 10 billion transactions this year and will be available across 40 countries. This growth is another example of how consumer preferences are shifting to a more mobile mindset.
According to GSMA, more than 5 billion people around the world have a mobile device, with over half of those being smartphones. Widespread smartphone adoption has empowered consumers to make a purchase in just a few clicks. It seems like a natural transition for consumers to turn to their phones—a device likely already in their hands—as a more seamless payment option, as opposed to pulling out a credit or debit card.
Understandably, mobile payment/wallet adoption shows no signs of slowing down. Worldpay’s Global Payments Report revealed a 33% annual increase of in-store digital wallet use. Also, although credit cards and debit cards remain the most popular payment methods in the U.S., digital wallets are on track to overtake credit cards as the most popular online payment method in 2020.
Payments providers can use this announcement as a chance to evaluate their mobile payment offerings and gain a better understanding of consumers’ evolving expectations in order to better serve their merchants. Whether that means looking for ways to streamline mobile payments at the point of sale or evaluating additional forms of mobile payments/wallets to accept, the payments industry can utilize the reveal of Apple Card as a chance to improve on its own mobile strategy.
With Apple Card’s release this summer, the payments industry will be monitoring to see how it will further drive mobile payment and wallet adoption and, even more importantly, impact consumer expectations of payments moving forward.