Apple Pay, the new mobile payment system from Apple, went live Monday with few of the hiccups that can sometimes come with Apple launches.
“For ten years, people have been saying that your phone is going to become a wallet,” says Gene Munster, an analyst with Piper Jaffray. “Today, that became a reality.”
Apple Pay lets you pay at participating retailers with an iPhone 6 or iPhone 6 Plus or via in-app purchases with the iPad Air 2 and iPad Mini 3, which will be released Friday.
The fingerprint sensor (“Touch ID”) on the device acts as your password to connect with financial institutions to approve transactions.
Richard Doherty, an analyst with the Envisioneering Group, says Apple Pay comes at the right time for consumers barraged by headlines about security breaches from credit cards.
“Consumers are more scared about credit card misuse than at any other time,” he says. Banks and credit card companies are receptive because of the security built into the TouchID fingerprint sensor. “Happier consumers will be more eager to buy,” he adds.
In USA TODAY tests and gauging response on social media Monday, the system worked — with retailers who were ready.
The Whole Foods Market we visited had branding welcoming consumers to pay via the iPhone, while at a Staples in New York the system didn’t work. The office chain hasn’t gone live yet in stores, only via its mobile app. A visit to a local Walgreen’s had an operating pinpad near the cash register — but no info communicated to consumers letting them know they could pay with their iPhone.
The three major credit card companies (Visa, MasterCard and American Express) and 500 banks are working with Apple Pay, but many of the banks weren’t live Monday. Some customers took to Twitter to complain that their credit card wasn’t accepted.
But tech-savvy folks were out in force Monday trying it out. Hotel Tonight CEO Sam Shank said 60% of the app’s bookings by iPhone 6 users came from Apple Pay. “That shows how powerful this could become,” he said.
In USA TODAY’s visits to stores Monday, most consumers were buying goods by pulling out credit cards, or — gasp — paying with cash or checks.
But at the Whole Foods Market here, one customer had already paid with an iPhone before we arrived. While we were there, Lee Chen bought his lunch with one.
“It’s super convenient, just slide and touch your finger and it’s done,” said Chen.
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SOURCE: USA Today – Jefferson Graham