This has been my theory for a couple years and it's exciting to see it come to fruition.
@Apple never wanted to be a credit card company. It wants to create lock-in benefits to its core money-maker: the iOS ecosystem, and it wants to (privately) own more types of user data.
@Apple never wanted to be a credit card company. It wants to create lock-in benefits to its core money-maker: the iOS ecosystem, and it wants to (privately) own more types of user data.
Mobile and QR payments took off in other countries (eg. Alipay/WeChat Pay in China), but they lagged significantly in the US for years.
Why? No superapps. Many people have credit cards, but not everyone has *one* app that they can use to pay for anything, anywhere.
Why? No superapps. Many people have credit cards, but not everyone has *one* app that they can use to pay for anything, anywhere.
If a company were going to bring mobile payments to the US, it had to unseat the ubiquitous credit card, and that meant it had to be a product that was already in everyone's pockets. There are vanishingly few companies that fit that profile, and Apple is one of them.
So when you started seeing ads on the street in NYC two years ago, prompting people to use #ApplePay at the checkout, you knew Apple was making a play to own in-person mobile payments in the US.
But it's not like carrying a credit card is a major consumer pain-point, so how do you get people to switch from their wallet to their phone as their primary form of payment?
Easy - give them a credit card tied to their phones: the @AppleCard.
Easy - give them a credit card tied to their phones: the @AppleCard.
The Apple Card has many phone-native features: a virtual card that gets added to your mobile wallet as soon as you're approved, a great PFM, a card number only visible in the app...
It's a great way to acclimatize users to the idea of paying with your phone instead of your card.
It's a great way to acclimatize users to the idea of paying with your phone instead of your card.
Apple owned the UI and the (beautiful) card and app designs. They let @GoldmanSachs do the heavy lifting when it came to underwiting (via @ProvenirGlobal) and managing the card program.
Apple just wanted to give its users one more way to use their phones for everything.
Apple just wanted to give its users one more way to use their phones for everything.
But you're still only solving one side of the two-sided market problem: what good is it that you can use your phone to pay in-person, if no merchants accept mobile payments?
Apple needed to find a way to spur higher retail adoption for mobile payments.
Apple needed to find a way to spur higher retail adoption for mobile payments.
This meant either (1) waiting for every merchant to upgrade their POS system to accept #ApplePay, or (2) Apple building or buying a better POS system itself, to get merchants to accept mobile payments.
That's why the @mobeewave rumor, if it's true, makes so much sense.
That's why the @mobeewave rumor, if it's true, makes so much sense.
That's aslo why, when it leaked that Apple was reportedly working on QR code payments, you could see where that was going: 9to5mac.com/2020/07/07/exc…
(**Note**: this is all a personal opinion and aspeculation on my end. I don't have better information than anyone else out there, but if it's true, I think this is a savvy strategic play -- and hopefully one that drives mobile adoption in the US!)
And as @EugeneACooke right points out: Apple did not enable contactless for the Apple Card. Entirely consistent with a strategy to get people to ditch cards altogether in favor of phones and mobile payments.
google.com/amp/s/www.cult…
google.com/amp/s/www.cult…
