UK banks drag their feet as Apple Pay opens for business

RBS may have Apple pay day 1.....    am sure most of their customers would prefer a stable core banking payment system.   Barclays strategy has not been bad so far,  so I am sure being a bit late for what will inevitably be a slow but steady growth in APay is not going to harm them or any of the day2 + banks... Nor are the big hold-out merchants going to lose busienss .... they will all still transact the same volume/value, with or without Apple pay....   just 15bps cheaper!      Lets see how the fraud and UI Goes from the early adopters perspective... its going to be interesting. Inevitably AP will evolve and grow here, as will other Mobile enabled payments.

Oops :)

Lack of pavement testing...

MBNA are in

Apple are probably the only brand that can expect to survive bad User Experiences at the POS and still have customers still risk further embarassment, attempting subsequent transactions... well done those who are making it happen and reporting to the community!  

We are the pavement testing!!

In the majority of cases this is not an Applepay failure.. many shops just not handling contactless very well... and - I am presuming Applepay is currently mag emulation and not full chip emulation ==> I know some shops (rightly) reject this in preference of chip emulation over contactless. thoughts?

I've had HCE working over Android for some time - when running in mag emulation mode I see the same sort of issues that are being reported currently by Applepay users. See www.axlpay.com for video of my spends. Where Apple has the power to sway banks - I don't have the same power. So  - any of you banks out there would would like to Pilot payments over Android with cloud served tokenisation - please do contact me. (skype: oharasha)

I would be interested if someone could explain to me what APay bring to the market that is new and unique?

Or is just yet another case of Apple doing something that is already there and charging more for it?

They are not bringing any thing new - tech wise. They are bringing the muscle in - the muscle to sway the card issuers (banks) into talking to their app. As I understand it - their app must (with mag emulation) provide a dynamic cvv for each transaction and this must be verified on the bank side.. .so they have to share keys (or make it more complex and operate token mechanics to achieve something similar).

Thanks Shane - Does it do anything new for me as a consumer? Anything that makes my life easier/cheaper?

Hi, 

That is a good question. I suspect that right now it adds minor benefits:

1. Possibly faster payment through turnstyles and the likes

2. Benefit of not keying in pin - some time saving and no risk of pin theft.

3. feel good!! I love the feel of paying by phone.. there is still a novely to it.

In time (and its close) - there will be some much nicer benefits... by paying via phone the loyalty and rewards functionality can be much more sophisticated - you spend, rewards go to phone instantly, could potentially end up as extra funds on phone. Add geolocation services and it becomes slicker again - you are walking past Costa and phone pings you that you bought your last coffee there and Costa is offering you 50P off if you buy a coffee now and so on.... ignoring the intrusion questions (which ultimately will be controllable by the user), there are some clever things around the corner and Applepay is just pushing it all forward. By integrating with Banks this early they can suffer some early headache  - the benefits of having the banks on board is huge for them.

Shane. 

What Apple brings is a much slicker user experience than any of the previous mobile payment offerings we've see in the UK which required fumbling with apps, topping up a prepaid account, mandated use of PIN, screen timeouts and a generally very negative user experience. They also bring the security of a device specific PAN thanks to tokenisation.

If the debate is about mobile payments over card payments, that's not an Apple specific question and the market will decide. What Apple has done is provide a very card like experience without the low contactless transaction limit (in some stores).

It's easy to snipe at any new product in it's first hours of operation (especially if onecan do so anonymously as "a Finextra member") but checking the twitter feed it seems that the majority view is positive. Interesting that HSBC's Apple Pay related tweets were negative in a 5-1 proportion due to them not being live on day one, so it seems that there is a demand from customers. https://www.brandwatch.com/wp-content/uploads/2015/07/2.HSBC_.png

For the general public this is (currently) about mass promotion of mobile payments. For the industry I think it's about tokenisation becoming the platform for more secure transactions in store, in app and online. For both it will ultimately be the foundation for a true multiapplication experience with payment, gift, loyalty and other functionality being brough to a single device and in many cases converging to a single tap.