Apple Pay is preferred by 67 percent of retailers recently surveyed, according to Investor’s Business Daily.
As mobile payment methods continue catch on, Apple Pay stands to dominate the market, according to current figures. The investment banking company, Piper Jaffray, surveyed 507 point-of-sale terminal providers, and 44 percent of their clients were either interested in implementing mobile payment systems, or already had them. Of that 44 percent, merchants preferred Apple Pay by 67 percent. Google Wallet and Android Pay, which use the same reader and algorithms, came in second, with 18 percent desiring either of those methods. PayPal (8 percent) and Samsung Pay (7 percent) trail by double digits when compared with the interest of the two leaders in the market.
According to Piper Jaffray’s Gene Munster, merchants are capable of accepting multiple digital payment methods, but this is likely at a higher cost for implementation. As costs come down for the readers of these systems, merchants will likely adopt additional methods. However, early adoption of these systems is important, and Apple Pay seems to have a great advantage moving forward.
Munster also stated, “It is telling that PayPal, who has been the leader in digital payments, so significantly under-indexed Apple Pay and Android Pay.”
PayPal was a pioneer in the internet payment industry and is one of the world’s largest companies providing such a service. However, the company has been slow in developing a system that can be integrated into brick-and-mortar businesses.
Part of the reason that Apple and Android lead in this market is because they had an early vision of using their devices as a mobile payment system. While PayPal does have an app that works on these devices, it was not until recently that they shifted focus to payments outside of the internet.
The reason that Samsung, which already has mobile payment hardware developed (unlike PayPal), falls so far behind Android and Apple is puzzling. It would seem that it should at least come in third in expressed interest. Its low score may be caused by a slow start and lower name recognition than PayPal. However, agreements with financial institutions may also be a key factor.
According to LowCards.com, Samsung Pay and Apple Pay are both showing strong growth.
“Samsung Pay and Apple Pay both saw hefty expansions over the last week. Last Wednesday, Samsung Electronics announced that its mobile wallet will now accept Wells Fargo credit and debit cards. This expansion means Samsung Pay now supports payment cards from 70 financial institutions in the United States, which represents 70% of the debit and credit card market.”
In contrast, Apple has over 1,000 accepted institutions, and is set to add another 27 soon. This covers nearly all of the major institutions in the United States. So while Samsung is still busy trying to get card support, Apple is now focused on adding merchant acceptance. This explains why their merchant interest is so far above the others.
Business Insider notes that Apple got out of the gate early in the mobile payment market. Strong brand recognition and success in the market are also playing key roles in the push to becoming the most preferred digital payment method. Tim Cook and Eddy Cue introduced Apple Pay in a keynote address in 2014.
BI states, “Several retailers have reported a boost in mobile commerce thanks to Apple Pay… Staples has reported that its checkout times are 35 seconds faster on its mobile app with Apple Pay than when manually entering card information.”
Consumer and merchant adoption and a lowering of implementation costs are going to play pivotal roles in the future of digital wallets and point-of-sale integration. With more consumers and merchants willing to use these methods, each company will see growth and acceptance. However, with a lead as large as what Apple Pay is enjoying now, it is hard to envision them not being the most preferred method of in-store digital payment for the foreseeable future.