Apple wants to own your wallet
News reports say Apple is preparing to get into the peer-to-peer payment game. The company is reportedly in talks with banks about adding this feature to its platform, most likely Apple Pay.
Apple is a little late to the party on this one.
Major banks, Venmo, Google, PayPal and Square are all trying to move your wallet from your pocket to your phone or computer, said Brian Yeager, an analyst at eMarketer. Central to the idea of an all-inclusive electronic wallet is the ability to — like in a real wallet — open it up and hand someone else some money.
“About 69 million U.S. adults will use mobile peer-to-peer payments in 2015 — that’s a third of mobile device owners,” Yeager said. He expects that to double by 2020. Meanwhile, Venmo payment volume almost tripled in the past year from 700 million to almost 2 billion a quarter.
For consumers, the draw’s obvious. “There are frequently no fees attached,” said Colin Gillis, director of research at BGC Financial.
There are, of course, some fees on certain transactions. There’s some revenue from payments that are never claimed as well, Gillis said. But the real draw for companies isn’t fees, it’s “to bring people into the platform,” Gillis said.
That is, if you can use your iPhone to pay your friend, you’ll stick around to use it to pay for music, or pay for groceries and you’ll be using Apple, Google, Venmo or Facebook.
“The second thing that matters is mobile data,” said Julie Ask, a vice president at Forrester Research. “P-to-P payment wallets give us a lot of insight into who our friends are, who we spend time with, where we spend out money.”
And these days data is money. Apple, though it focuses less on data, will be well-positioned if it enters this space. It already has 800 million itunes accounts with cards on file.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.
