Despite the fact that PCM readers have known for weeks that Apple Pay was to launch in the UK on the 14th of July – it did launch.
However, depending on which of the several hundred PR’s and Comments from the entire
payments ecosystem, the launch has either been a massive success and is the future of UK payments or it has been a wet weekend. Here we try and present both sides.
The UK is the second market for Apple Pay, after the initial launch in the US nine months ago. The service works with the iPhone 6 and Apple Watch at NFC terminals in shops, and the iPhone 6, iPad Air 2 and iPad mini 3 also support Apple Pay for payments within apps. The Touch ID on the devices means users only need to hold their finger on the TouchID pad to confirm the payment.
Whilst there has been a mesmerising effect on marketers over the last 24 hours, Apple Pay has not caught the imagination of some of the country’s biggest banks with only Nationwide, NatWest, Royal Bank of Scotland, Ulster Bank and Santander ready on day one.
Lagging behind are some of the UK’s major banks, including HSBC and First Direct, Lloyds Banking Group, TSB and Barclays Bank, although HSBC says that it will be online with Apple Pay in July, while Barclays says that the service would be coming ‘in the future’.
A survey of iPhone users conducted by Forrester found that only 27% would put their trust in Apple’s digital wallet, significantly fewer than had faith in PayPal (43%), their bank (41%), a credit card (40%) and Amazon in which 32% of respondents had faith.
In a blog post Forrester analyst Thomas Husson said: “Apple still has to demonstrate the added value it will bring to merchants (better experience, faster checkout, incremental revenues, etc.) and brands. Also, Apple needs to create trust among UK consumers. They managed to do so in the US and no doubt trust will increase with the backing of the main banks.”
Husson also goes on to say that Apple Pay uptake will be faster in the UK than in the US because of the UK’s more advanced and extensive contactless infrastructure.
However, he also points out that “faster adoption in the UK does not mean Apple Pay will scale quickly” because the payment service needs merchants much more than merchants need Apple Pay.