Apple Pay makes up 5 percent of global card transactions, could double by 2025

nanoguy

TS Addict
Staff member

If we look at its latest financial report, Apple still makes most of its money from iPhone sales, which remain strong in the face of longer replacement cycles. However, buried in the details is one of the company's most successful bets - Apple Pay, which is expected to make up ten percent of all card transactions by 2025.

It's easy to overlook this in Apple's quarterly reports, since the company chooses to lump together numbers for all of its services. But when you think about it, there are now 1.5 billion Apple devices in use, and the convenience of Apple Pay coupled with growing support at retailers and other services makes it a particularly attractive option for mobile payments - so much so that no less than 15 billion transactions have been made through it.

According to a Quartz report citing analysts from research firm Bernstein, Apple Pay is currently used in around five percent of global card transactions, which makes it look increasingly capable of taking on established payment processing services like PayPal, which has been expanding in Asia and snapping up companies left and right, such as comparison shopping service Honey and payments startup iZettle.

Apple's new focus is on monetizing its loyal customer base with services, and taking a slice of the $1 trillion payments industry could help its growth story. The Cupertino giant's services division made more than $12 billion in revenue in the last quarter of last year, and the company is even looking into bundling all of its services to attract more users. Making Apple Pay work well with most apps and services would further amplify revenue generated within its ecosystem.

The ecosystem advantage can't be overstated, since Apple doesn't expose NFC payments to other payment services. In the US, Apple Pay has already surpassed Starbucks, Google Pay, and Samsung Pay as the most used mobile payments platform. But as the service is expanding in Asia and Europe, it faces challenging legislation like that passed by Germany which forces Apple to expose its NFC chip to competing mobile payment services. In China, it has relatively slim chances of competing with QR code-based services offered by Tencent and Alibaba.

Overall, Apple Pay looks set to fuel contactless transactions worldwide, which are estimated to reach $6 trillion by 2024. If we consider that banks pay Apple 0.15 percent of every transaction, the case can be made that Apple Pay could soon become a multi-billion dollar business. And if that doesn't happen, there's always Apple Card.

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Lounds

TS Maniac
I used Google Pay for most transactions, I can totally see Google Pay over passing Apple Pay. Bare in mind Apple pay had 1-2 year head start and the Android platform in general is very fragmented, but give it 2 years Google will be double Apple in wireless transactions.
 

Dosahka

TS Addict
I used Google Pay for most transactions, I can totally see Google Pay over passing Apple Pay. Bare in mind Apple pay had 1-2 year head start and the Android platform in general is very fragmented, but give it 2 years Google will be double Apple in wireless transactions.
Not to mention that with Apple Wallet it is automatically added to your watch when it's paired with a phone, cards reported stolen will automatically refresh within a day or so in the Apple Wallet, way before you get your physical card.
I'm not sure Google Wallet/Samsung Wallet can do that.
Also it has a feature called Express Transit (which works even with a dead phone battery up to 5 hours) which can come in handy (I was in a situation when I had to, it saved my "life" for sure)
 

QuantumPhysics

TS Evangelist
I have had Apple Card since it was released to the public and haven't used it once - beyond the boost it gave to my credit availability.

My problem is that they don't have a travel rewards points strategy yet.

My Capital One Venture card - which I use daily - gives me 1.25 points for each dollar. No annual fee. I pay before the bill gets printed so I never pay interest.

I typically save 60,000 points a year from my purchases and that equates to $600 which I can use on my international trips/ business class upgrades.

If Applecard gives me a clear advantage over Capital One venture, I will completely stop using Capital One Venture and switch over to Apple.