Mikey Campbell
Fresh data from investment firm Piper Jaffray shows Apple Pay adoption hovering between 10 and 20 percent, but analyst Gene Munster expects numbers to rise in 2016 as Apple integrates attractive new features like peer-to-peer payments and in-browser integration.
According to the latest statistics from Piper Jaffray's Apple Pay adoption tracker, uptake among U.S. iPhone users is relatively low, but the system is "overwhelmingly the share leader" in point-of-sale mobile payments, Munster said in a note to investors on Thursday.
Munster notes Apple Pay bank partnerships are accelerating, jumping from 515 supporting banks in September to 930 as of today. A provided chart shows the number of U.S. banks accepting Apple's service has roughly doubled every three months since March 2015, with most of that growth originating from U.S. institutions. Apple's rolling list of service partners, which added 58 new U.S. card issuers earlier this month, backs up Munster's data.
While not growing at the same pace, the number of apps supporting Apple Pay in-app payments adoption is also increasing and now sits at 131 titles. In June 2015, Munster modeled 50 apps as accepting Apple Pay, which rose to 70 apps in September. Large retailers are also slow to adopt, reaching 98 named stores this month, including 27 that have pledged forthcoming support. The number of retailers that actually accept Apple Pay is unknown, however, as smaller outlets and local establishments are not counted. Munster estimates Apple Pay is available at more than one million POS locations in the U.S.
Looking ahead, the analyst believes Apple will introduce new features like peer-to-peer and in-browser payments later this year. A report in November said Apple has already discussed a potential P2P rollout with major banks like J.P. Morgan Chase, Capital One, Wells Fargo and U.S. Bancorp, though no evidence has surfaced to support such claims.
"While 2015 was the year of Apple Pay adoption at banks, retailers and in-app, we believe 2016 will be the year of new features for Apple Pay," Munster said. "We believe peer-to-peer will be an important feature to increase overall consumer usage and awareness of Apple Pay and see mobile in-browser payments as a significant addition to the Apple Pay addressable market."
Apple has yet to make an official move toward P2P, a market controlled by established service options from PayPal and Square. If and when the company decides to throw its hat into the ring, Apple Pay P2P will have instant access to a massive installed user base that could catalyze wider adoption.
Wesley Hilliard
Marko Zivkovic
Christine McKee
Malcolm Owen
Amber Neely
27 Comments
They could probably double adoption overnight if they simply convinced the Canadian and Australian banks to agree to use it. Canada in particular has had the necessary terminal infrastructure in place for over a decade. It's over a year late already.
They have plenty of US banks signed up, but very few retailers. They should work on that.
In LA area... I can easly say that about 60% to 70% of my transactions are now done through applepay on the applewatch.... From chain stores to mom and pop stores of all kinds.
This was not the case a few months ago... There has been an exponential growth in merchants accepting apple pay and im loving it...so do those who see my transaction on the applewatch... Its always followed by a comment like.. "How cool ..is that the apple thingy... ." And smiles .
P2P will be a nice addition. I like the Cash app by Square but have only used it twice. All of my friends have iPhones and use Apple Pay so if and when it comes to P2P Apple Pay I won't need the Cash app. I think it's difficult to convince your friends to download an app like that but with Apple Pay it will be right there already.