Apple Pay a long way from reality
It’s been two years since Apple Pay arrived in New Zealand but we’re still a long way from having our smartphones replace our wallets.
I used to be confident that having a phone would soon mean that we wouldn’t need to take our cards or cash with us every time we headed to the shops.
There was a flurry of activity a few years ago as banks and tech companies joined up to allow you to use your smartphone to pay for everyday items.
But I recently left home without my wallet and I tried and failed at three cafes to pay with my phone, which was loaded with Apple Pay.
It was a stark reminder that we have a long way to go before digital wallets become standard and how little progress has been made in New Zealand.
So what happened to the digital wallet dream?
Well, it appears banks, tech companies, Visa and the companies that own the payment terminals are stuck in a rut.
Each holds a key to the success of digital wallets but no one wants to give up anything.
The tech companies, Apple and Google, control the payment apps and are demanding a cut of every transaction, something the banks and Visa are used to keeping for themselves.
And shops aren’t updating their payment terminals as they have to pay a fee each time PayWave (which is required when using a smartphone payment app) is used, which means not many shops can accept digital wallet payments.
I’m not sure what’s going to break the deadlock but they may all lose out if another party joins the market.
An example of this is China’s Alipay or Wechat Pay, mobile payment apps that let you make a payment to anyone quickly and effortlessly. They’re widely accepted, work on any phone with any bank and don’t require thirdparty terminals.
Unfortunately, I don’t expect something similar to arrive here anytime soon. Breaking the banking stranglehold is extremely difficult and there doesn’t seem much customer demand for the service.
The best we can do for now is use individual apps such as BPme, which lets you pay for petrol at BP stations using your phone without having to go into the shop. It works well but ideally, we don’t want to end up with an app for every shop or service we use.
One day, Kiwis will be able to leave home with just their smartphone or smartwatch and use it to pay for everything. I used to think it was a few years away but now I feel it’ll be a lot longer.