Apple Pay leads pack with mobile users

Apple Pay is the go-to digital wallet for most debit card users. This is according to new data from Auriemma Consulting Group. An Auriemma study of debit card issuers indicates that Apple Pay makes up 77 percent of mobile wallet transactions, leaving little market share for competitors Samsung Pay and Google Pay, which account for 17 percent and 6 percent of mobile wallet payments respectively.

Anita Solaman, director of Auriemma's Debit Management Roundtable, said high usage rates for Apple Pay may be a matter of demographics. "Apple users skew younger, and younger consumers are more likely to be debit [card] users," she said.

Financial institution support also plays a role, Solaman suggested. While large financial services companies tend to focus on issuing credit cards, debit cards are a core offering of most regional banks and credit unions. Debit-focused issuers see Apple Pay and other mobile wallet apps presenting opportunities to drive more customer engagement. "Regional banks with large debt card portfolios are driving top-of-wallet usage," Solaman said. "That means embracing mobile and digital options, particularly for younger customers."

Mobile wallets also allow these smaller issuers to go toe-to-toe with larger issuers that have developed their own branded wallets, like JPMorgan Chase's Chase Pay app. Evidencing this trend, Solaman noted that many smaller banks and credit unions are encouraging customers to load mobile wallets onto their devices during the account-opening process. "Provisioning a card has become part of the onboarding process," she said.

Samsung wallet users more engaged

Apple Pay's dominance in terms of wallet share doesn't necessarily equate to more transactions per user. Auriemma's study found Samsung Pay users to be more engaged, making an average 7.3 transactions a month compared to 5.5 transactions a month for Apple Pay and Google Pay users.

Solaman believes this may because Samsung has cast a wider technology net. Unlike Apple Pay and Google Pay, which work only with NFC card readers, Samsung Pay also is compatible with the traditional card readers most merchants already have in place.

Even as usage grows, however, mobile payments remain a nascent trend, accounting for just 0.6 percent of all debit card transactions in the second quarter of 2018, Auriemma reported.

However, banks and credit unions remain optimistic that mobile wallet adoption will grow as merchants and their customers seek faster, smoother checkout experiences. "Roadmaps for 2019 are all about digital, friction removal and customer experience," Solaman said. "For many debit card issuers, mobile wallets are a key part of that strategy."

Editorial Note:

Whether you want to upgrade your POS offerings, find a payment gateway partner, bone up on fintech regs or PCI requirements, find an upcoming trade show, read about faster payments, or discover the latest innovations in merchant acquiring, The Green Sheet is the resource for you. Since 1983, we've helped empower and connect payments professionals, starting with the merchant level salespeople who bring tailored payment acceptance and digital commerce tools, along with a host of other business services to merchants across the globe. The Green Sheet Inc. is also a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals.

Notice to readers: These are archived articles. Contact information, links and other details may be out of date. We regret any inconvenience.