Apple Pay launched in October 2014, and the tech giant provided an update on the mobile wallet’s progress in its first-quarter earnings call.
CEO Tim Cook noted that Apple Pay is bringing in one million new users per week and that transaction volumes are “five times higher” than at this point one year ago. However, the company has not seen “any meaningful revenue impact from Apple Pay yet,” said CFO Luca Maestri. The CFO expects the increasing transaction volume to potentially make Apple Pay more valuable in the future.
One advantage Apple Pay is slowly gaining is widespread acceptance. Approximately 10 million contactless-enabled terminals around the globe, and 2.5 million of those are in the U.S. (up from just 2 million in February 2016). This wider acceptance should be a catalyst for growth.
Hesitance about Apple Pay’s acceptance has been a significant barrier to testing the mobile wallet, but wider acceptance could create user loyalty and higher payment volume per user.
Apple also has some plans on the horizon that would make Apple Pay more integral to it’s overall business. The company recently debuted Apple Pay in China, Australia, Canada, the U.K., and Singapore, which could spur user growth.
But keep in mind that only American Express users can access the service in these locations, and those users make up a small portion of the total market. If Apple were to sign deals with larger issuers, then Apple Pay would grow internationally.
Furthermore, reports say Apple is considering integrating in-browser and peer-to-peer (P2P) payments into Apple Pay, which should draw in more users and make existing users more loyal. In-browser payments, in particular, should give Apple Pay an important source of revenue if the company can take a piece of the interchange fee from these transactions.
Evan Bakker and John Heggestuen, analysts at BI Intelligence, Business Insider’s premium research service, have compiled a detailed report on the payments ecosystem that drills into the industry to explain how a broad range of transactions are processed, including prepaid and store cards, as well as revealing which types of companies are in the best and worst position to capitalize on the latest industry trends.