Apple could soon be replacing your wallet
Apple Inc. is developing a person-to-person mobile payment platform that will allow users to transfer funds directly from their iPhone. The new initiative will put Apple in direct competition with PayPal and its subsidiary Venmo who are the current market leaders in the mobile payment space. No release date has been announced for the platform.
Apple is currently involved in discussions with J.P. Morgan Chase, Capital One, and Wells Fargo about the service. In order to implement a project of this magnitude, Apple will need the cooperation of many large financial institutions.
The tech giant already has an established payment system called Apple Pay, which allows users to store and access their credit cards from their phone. This platform is useful at retailers or brick and mortar stores but does not cover the full spectrum of payment options.
A person-to-person mobile payment platform is just another step towards CEO Tim Cook’s vision of replacing the wallet. It will allow users to transfer funds from their checking accounts to the accounts of other users through Apple devices. The iPhone accounts for approximately 42 percent of smartphones in the United States. It would be much easier for all those users to transition to Apple’s payment system as opposed to having their financial information spread out over multiple applications.
— CNBC (@CNBC) November 12, 2015
Although PayPal and Google are both already established in the person-to-person payment space, Apple should be able to assume a significant amount of market share. The world’s most valuable company has a large customer base, significant bargaining power with merchants and vendors, and a strong enough infrastructure to immediately become a top competitor in the space.
Will mobile payment platforms make cash and credit cards obsolete? Can Venmo compete with Apple in the long term? Feel free to leave a comment or find me on Twitter @Andrew_Morse4