My track record on Apple is pretty good.. having broke the Apple Pay news in 2014 and Last August I announced the Apple/Mobeewave acquisition. Apple is great at keeping secrets… perhaps the best tech company in the world in this regard. My latest forecast? Apple will enable payment acceptance in the US this October with Elavon as payment processing partner.
Let me give you a feeling for the dynamics here. Large US banks have put Apple on a “black list” of sorts.. they have been unanimously voted the worst partner a bank could ever work with. Why? They dictate terms and pricing, insist on share of payment revenue (15 bps for Apple Pay) AND come up with competing products (ex Goldman Sachs card).
Who is Apple’s friend? anyone that benefits from overall acceptance and volume! The biggest technical change that is allowing Apple to proceed is device certification. Platform certification requirements of V/MA have typically been a HUGE hurdle for new devices. Software and Hardware had to be locked down for certification (see 2018 blog). The networks are now certifying devices in a much simplified regime that enables Whitebox security (see blog on PCI and Whitebox Cryptography). What is it? Per this article
Device Certification is going through a massive sea change. Embedding payments and contactless in everything is going to be easier (think scooters). For Apple/Mobeewave their supporters are V/MA.. and I’m 60% confident in the October release date.
Who does this impact? Anyone focused on physical in-person P2P payments and Very Small Business. This is not a POS solution.. so I don’t think Square’s business is at risk.. but perhaps growth with service providers or in tipping.
Apple’s BIGGEST Innovation? Enabling EVERY iPhone holder to Make AND RECEIVE payments. Think about it.. the biggest flaw in the V/MA schemes is the segregation of entities into those that make payments (thru issuers) or take payments (thru acquirers). 90% of US retail payment innovation revolves around this insane delineation. My biggest questions?
What is the “accept payments” enrollment process (with Elavon)?
Will Apple auto enroll? (allow every consumer to accept)?
On the P2P front.. will Apple be able to create a Venmo like dynamic for tap phones? Remember Paypal “bump pay”?
How has Apple solved Mobeewave’s biggest issue: A Payfac that will manage risk in front of Elavon.