Apple confirmed in June the much anticipated geographic expansion of Apple Pay to include consumers and businesses based in the UK. Launching in July with over 250,000 merchants and many of the banks that issue debit and credit cards to UK consumers, the service looks ready to kick off with a big impact.
Apple Pay enables one touch transactions both in store by waving a registered Apple device near a payment terminal (similar to how contactless cards work today) and for purchasing goods and services from mobile apps downloaded onto the registered device. In both cases, the transaction is verified by using Touch ID, or fingerprint reader, built into supported Apple devices.
Interestingly, Apple’s launch of Apple Pay in the UK will be at about the same time as the Apple Watch becomes widely available. Users with Apple Pay installed on their phones will be able to use their watches to complete payment in store without even pulling their phones out of their pockets.
The UK is widely expected to see a faster adoption of Apple Pay compared to the US because of the existing infrastructure in place to support contactless card payments. This same technology, combined with some behind the scenes tech known as “tokenisation”, allows for simple and secure card payments using only your mobile phone.
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This is why, for SMEs who accept card payments and already have contactless terminals, there is nothing they need to do to start providing Apple Pay as an option for customers when it is launched sometime in July.
For SMEs that are primarily selling physical goods and services in-store, but have mobile apps or are considering them to enhance the customer experience, supporting Apple Pay is a must to take full advantage of the improved customer relationships and valuable data that comes from supporting mobile apps.
The focus for this type of SME should be how they can use Apple Pay to provide a consistent and connected experience for customers, regardless of whether they are buying in-store or in-app.
Ecommerce SMEs will see that Apple Pay reaffirms a consumer expectation that paying with their mobile is fast, easy and secure. Customers with eligible Apple devices will be able to complete purchases without setting up an account and filling out lengthy forms.
This change in customer expectation will affect not only Apple Pay users, but consumers on other mobile devices as well.
Don’t believe that mobile payments will make a significant change to sales? A company in the US, Staples, has seen a 109 per cent increase in overall conversion in the past nine months after accepting Apple Pay. So if your business is seeing traffic from mobile devices and is still using a traditional ecommerce gateway, now is the time to reconsider your approach – with great urgency.
Also announced at Apple’s Worldwide Developer Conference (WWDC) around Apple Pay is the inclusion of rewards or loyalty programmes into the service. It is a crucial addition to broaden Apple Pay’s appeal to both consumers and business, also another step to our journey to replacing our physical wallet with our mobile phone.
Customers using Apple Pay will no longer have to dive into their wallets to look for physical loyalty cards, brand loyalty programmes can now be tied in to the payment process, making payments not only seamless, but also rewarding.
TfL and many of the other retailers that have driven the accelerated adoption of contactless card payments in the UK are on board for the initial launch, with many well-known brands already announcing their participation.
In essence, Apple Pay has already transformed mobile payments for businesses in the US and today we have a clear timeline for the launch of Apple Pay in the UK. The UK has been at the leading edge of mobile payments adoption globally and businesses and consumers alike will benefit from this significant development in the move to mobile.
Dennis Jones is CEO of payment services provider Judo Payments
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