Author: Stephen

Apple faces challenges in Australia’s mobile payments market

| August 20, 2015

Banks may have serious concerns regarding Apple’s mobile payments service

Some of Australia’s major banks may have a problem with Apple and its new mobile payments service. According to a report from the Financial Review, banks have taken issue with the interchange fees associated with Apple, and if the problem persists, banks may begin looking for alternatives to Apple Pay, which are becoming more plentiful with each passing month. With Samsung and Google launching its own mobile payments services, Apple may have to work to satisfy banks in order to maintain its position in the mobile market.

Banks have no wish to provide Apple with significant fees on transactions being made

The crux of the issue between Apple and Australia’s major banks is $2 billion in interchange fees that the banks make every year. In the United States, it is estimated that Apple earns 15 cents for every $100 that is spent through Apple Pay. In Australia, however, banks are not willing to provide Apple with the cut of the fees that it is asking for. If this problem continues, Apple may have trouble establishing an effective foothold in the Australian market, where consumers are becoming very interested in mobile payments.

Australian banks may be ahead of the curve when it comes to mobile payments

Apple Australia mobile paymentsAccording to Ian Narev, CEO of the Commonwealth Bank of Australia, Apple Pay may face significant challenges in the country due to the existence of other mobile payments products. Narev suggests that many Australian banks are far ahead of others in the world when it comes to mobile payments services. As far as Apple Pay is concerned, there are other services in the country that have the same functionality as Apple’s service that have been available to consumers for 18 months or more.

Banks want Apple to help support the development of a new payments infrastructure

One of the major concerns that banks have concerning Apple Pay in Australia is that the Reserve Bank of Australia is forcing the country’s banks to help cover the cost of development a real-time payments infrastructure. Banks do not want Apple to benefit from the development of this infrastructure without investing into its establishment itself.

Samsung to launch its mobile payments service in the US next month

| August 18, 2015

Samsung Pay will be launching in the United States next month following trials in South Korea

Samsung has announced that its new mobile payments service, Samsung Pay, will be available in the United States next month. The company has been testing the service in South Korea this month, hoping to iron out bugs before launching in a larger market where mobile payments have begun to grow aggressively. The service will function in a similar fashion to other platforms, such as Apple Pay, as it will be able to store financial information as well as data provided by retailers.

Samsung Pay to make use of NFC technology and tokenization

Samsung Pay will be leveraging NFC technology in order to facilitate transactions. This technology is capable of transmitting digital information over short distances, which is why it has become the backbone for most mobile payments systems. The service will also be using fingerprint verification in order to protect the financial information of its users. Further protection will be provided in the form of digital tokens, which are used to replace consumer financial data in order to protect it from exploitation.

Samsung will be competing with Apple in the mobile payments space

Mobile Payments - SamsungThe launch of the new service represents another step forward concerning Samsung’s plans for mobile payments. The service is meant to compete directly with Apple Pay, which is already available in the United States and will soon be available in other markets. Apple has managed to establish a powerful lead in the mobile payments space, largely due to the security that the company has injected into the service.

Mobile payments services continue to face significant challenges that prohibit their success

Though Apple has managed to establish a lead, it still faces many of the challenges that are preventing other mobile payments platforms from finding widespread success. Security is one of the more significant of these challenges. In the past, high profile cyber attacks have called into question the safety of mobile payment platforms, which has limited the appeal of these services among consumers.