The diversity of payments in the US

As a payments geek, I am always curious about payment experiences in various parts of the world. In the last month I had a couple of trips to the US – to New York and to New Orleans – and they just reminded me how diverse the US payments environment is. And I am only talking about the physical POS; I haven't really ordered anything online or in-app while I was there.

First, a few observations around EMV. As I live in the UK, all my cards are Chip and PIN, and the US market has been migrating to EMV for a while now. Of course, the migration can't happen overnight – some merchants have already upgraded their terminals, but many haven't yet. Also, there is no mandate in the US to use offline PIN, so "chip and signature" EMV cards are common amongst the US issuers. As an end-user, I experienced a full gamut of payment scenarios:

  • Majority of merchants would simply take my card, swipe it and give it back to me straight away. Not one of them checked if my card is even signed, let alone if the signatures matched…
  • On a few occassions, I was asked to insert the card into an EMV terminal and enter my PIN. And then we waited. And waited more. And a bit more. I knew EMV transactions take longer in the US, but I didn't realise just how much longer… Not surprisingly, the networks had to do something about it and have announced software updates (e.g. Visa's Quick Chip for EMV and MasterCard's M/Chip Fast) to speed up transaction processing.
  • Not a single eating establishment I visited had a handheld EMV terminal. All of them just took my card and disappeared for a while in the "back of the room" – a practice that sends shivers down the spine for most Europeans 🙂
  • On at least one occassion, I entered the PIN, yet the salesperson was still looking for a signature box on the receipt and wanted me to sign it. I had to explain that PIN replaces the need for signature; of course, these things will disappear once merchants learn more about the EMV cards.

A number of merchants in New Orleans had a Clover POS station. It looked really sleek on retailer desks and transactions seemed fast and easy. I asked a couple of them what they thought of it, and they all said they were very happy with the device, its looks and ease of use.

As a side note, American Express cards seem to be far more widely accepted in the US. In Europe, I got into a habit to double check at new places if they take Amex; in the US, that seems unnecessary.

Of course, it's no longer just cards. US was the first market in the world to see the launch of Apple Pay, Android Pay and a number of other digital wallets. The challenge for many of these wallets is the lack of places where they can be used, as contactless terminals remain relatively rare, albeit growing. However, when they can be used, they work very well. The biggest advantage that I can see as the UK user of Apple Pay is that in the US I can use Apple Pay for any transaction, whatever the amount (as long as my issuer is happy to authorise it). I had no problem paying for a taxi ride from New York's JFK airport to downtown by Apple Pay ($70+ fare with the tip). In the UK, Apple Pay and Android Pay (which has just launched this week) are subject to the same contactless card transaction limits and can only be used for transactions of £30 or less. Again, we expect this to change, as contactless terminals get upgraded.

I was also intrigued to see a PayPal acceptance badge at one of the POS terminals. I asked the cashier if it was a popular payment method amongst their customers. The cashier said that it seemed new to him, and that he personally had yet to see anyone trying to use it. I must admit, I am a fan of the PayPal wallet and use it whenever I can, but nearly all of my transactions are online/ via a mobile app. This time, I only noticed the PayPal sign after I already started paying by card, so can't quite report on the actual experience…

And yet, cash remains hard to beat, with many places only accepting cash. I refrained from visiting any of the dodgier establishments on New Orleans' Bourbon Street, but I didn't even had to in order to experience the power of cash. Most sellers in the French Market clearly prefer cash; getting into (jazz) Preservation Hall is "cash only" at the door, and while not every place has the sign as artistic as the one in the picture below, "cash only, one drink minimum" was a common mantra of many bars with live music.

cash only

Clearly, there is a lot of payments innovation in the US. Various wallets and innovations in POS contribute to the diversity of end user experiences. Such diversity is a good thing and if anything, it will only increase, as customers will have increasingly more ways to pay. And as the migration to EMV continues, the undesireable kind of diversity should reduce as well.

Reconciling TouchID with Bank T&Cs

Apple’s TouchID is brilliant – I now use it not only to unlock my phone, but also to log into my Amazon account. I can also use it to log into my Amex app and my bank’s mobile banking app. And of course, it is the way to initiate Apple Pay transactions. The only trouble is that none of those providers can be assured that it is really me doing all of this. TouchID allows registering up to 10 different fingerprints, and authenticates the user locally by matching his or her fingerprint to the registered templates. However, authentication is not the same as identity – banks and other apps know it is someone authorised to use that phone, but they don’t know it’s me, Zil Bareisis. It is likely to be me, but it could also be my wife or my kids. It could even be a total stranger if in some bizarre bout of insanity, I allowed them to register their fingerprint with my phone. The Telegraph reported last week that the UK banks are very much aware of this issue and have decided to take a hard stance:
“Banks have warned customers that if they store other people’s fingerprints on their iPhones they will be treated as if they have failed to keep their personal details safe.
This means the bank can decline to refund disputed transactions or refuse to help where customers claim they have been victims of fraud.”
According to the paper, “the banks’ position is typically buried in the detail of bank account Ts & Cs”, something as we all know that most people accept without reading in detail. I can appreciate the banks’ concerns, but I wonder if they are somewhat overblown. Although this will change in time, most of Apple Pay transactions in the UK are still capped at the contactless limit (ÂŁ30). Any of my family members today can take my contactless card and use it as contactless without any PIN. I haven’t heard too many suggestions that I should keep my card locked away from my family members. However, if this were to happen, I should be prepared to accept my family’s transactions and not report them as fraud. I am no legal expert, but it doesn’t feel like inserting protective statements within T&Cs is the way forward. First, it’s not very transparent. Second, if the issue were to arise, it is something that would not be easy for banks to prove. Could consumers just delete all the other fingerprints in case of a dispute? Finally, it’s just poor customer service. Instead, banks should invest into educating consumers about digital technologies and how to use them safely and responsibly. Even if it’s as basic as, “don’t allow strangers to register their fingerprints on your phone” and “be prepared to accept your family’s transactions and not dispute them as fraud.” As the value of Apple Pay transactions grows, banks ought to consider deploying additional techniques, such as behavioural analysis to authenticate the users and minimise fraud. As with most security, multi-layered approach is likely to work best.

Viewing mobile payments strategy holistically

As the one year anniversary of Apple Pay approaches, banks have to make more decisions about their mobile payments strategy. Android Pay launched in the US a few days ago, and Samsung Pay is expected to be available there soon as well. Should a bank just stick with Apple Pay or enable their cards with all the “pays?” Should they consider alternative options, such as their own HCE-based, or depending on the market, even SIM-based NFC solutions? The answer is that banks have to view their mobile payments strategy holistically. Apple Pay, good as it is, is only available for the latest iOS devices, and only for in-store and in-app payments. Android ecosystem offers more choice: Android Pay, Samsung Pay, HCE and SIM for NFC, but what about P2P and other payments? Barclays in the UK announced this week that it will be launching its own version of mobile payments for Android-based phones. Barclays was a notable absentee when Apple Pay launched in the UK, and are forging ahead with Pingit and bPay wearables. As a result, some view this latest move as yet another indication that the bank “appears to be adopting a go-it-alone strategy with its roll-out of mobile payments, preferring to retain the primary contact with the customer rather than providing the rails for interlopers like Apple, Google and Samsung to hitch a free ride.” I wouldn’t read too much into it. Barclays has since said that it would support Apple Pay at some point in the future. In my view, Barclays is doing what all banks should do – think about mobile payments holistically, i.e. how they will support mobile payments across different platforms and use cases (e.g. in-store, in-app, P2P, etc.). Yes, Android Pay has been launched in the US, but it’s not yet available in the UK. Yet HCE technology has given banks around the world an opportunity to launch their own branded NFC solutions for Android, irrespective of whether Android Pay is available in their market or not. Rather than waiting for Android Pay or Samsung Pay to come to the UK, Barclays is joining the growing list of banks such as BBVA in Spain (read the case study of BBVA Wallet, our Model Bank winner here), RBC in Canada (who were granted a patent for their Secure Cloud payments earlier this month), and others that are taking a proactive stance in developing mobile offerings for their Android user base. I have a new report coming out soon that covers key digital payments issues, such as Android Pay and tokenisation in more detail. Watch this space!

First-time success rate of my Apple Pay transactions today: 0%

Yes, you did read this right – today I could not complete a single Apple Pay transaction successfully first time. This was my experience today:
  • I tried using Apple Pay five times – four times to get in and out of the London transport network and once at a coffee shop to buy an espresso.
  • Not once did I manage to complete the transaction right away.
  • Only once I could complete the transaction via the fingerprint. And before you accuse me of sweaty fingers, on all occasions I made extra efforts to wipe clean my phone’s TouchID reader and my fingers before approaching the terminal. And while I did have some issues with TouchID in the past, now the fingerprint unlocks the phone just fine most of the time.
  • Three other times, I had to type in my password, which then completed the transaction.
  • I could not get my coffee on Apple Pay at all – no matter what I did, the transaction would not go through. My default card is Amex, so I asked the merchant if they accepted Amex cards in the first place (I couldn’t see any obvious signs that they did). He confirmed that they accepted Amex, but not if the card was contactless! Which I guess explains my lack of success in that instance, but there was no way of me knowing it in advance – the shop clearly had contactless terminals, so I assumed my Amex inside Apple Pay would work just fine. In the end, I embarrassingly put my phone away and paid cash.
OK, I admit, the sample size is not big – only five transactions and I haven’t tried a diverse POS environment (TfL and a coffee shop), so maybe I’ve just been unlucky. But it’s not the first time this is happening to me. I already highlighted my trepidation of going up with Apple Pay to the tube gates in an earlier blog. And I had other bad experiences: after trying to pay with Apple Pay and failing at a local Co-op shop, I was told that I couldn’t just use a plastic contactless card or pay by cash – I had to insert my actual Amex card into the reader and type in the PIN code to complete the transaction. Really?? Looks like I am not alone struggling with Apple Pay in the UK, as this Twitter conversation demonstrates: I also have a Visa debit card registered with Apple Pay, so I will try it out as well, but based on Richard’s comment, it doesn’t look like it’s a card type-specific issue at the moment… I love the idea of Apple Pay and easy payments by mobile phone. And I know that people like Jeremy and Richard are just as passionate about payments as I am, so we will continue to persevere and keep trying. But what will a “normal” consumer do if they have a bad experience? Will they be excited enough to come back and try again or will they just give up on mobile payments before they had a chance to succeed? I hope they don’t, but these early Apple Pay glitches clearly show how difficult it is to create a truly great customer experience in payments, especially at the POS.

Why I won’t be using Apple Pay during rush hour on London transport

I am finally a proud user of Apple Pay! It came to the UK on July 14th while I was away on holiday, but I managed to set up my first card even while I was abroad. And I was very proud and pleased when I got back and completed my first Apple Pay transaction. My experience has been more or less as expected. I got an email from American Express announcing that Apple Pay is available and suggesting that I should add my card to it. I have been using my Amex for iTunes, so adding it to Apple Pay was relatively straightforward. Somewhat unexpectedly, I now also get notifications on the phone for all transactions, including those made with a card – I would have thought Passbook would only have my Apple Pay transactions, but I guess it does make more sense to see all transactions on the card in the same place. I also added a debit card issued by my bank. The bank also promoted Apple Pay to me, and when I logged into my mobile banking app, Apple Pay was featured prominently at the top of the “home screen.” Clicking on the banner took me to the screen within the bank app which explained about Apple Pay and had an “Add Card” button. Given that I was already inside the bank’s app having authenticated myself via TouchID, I was expecting that this button would give me a list of the bank issued cards I have and I could add any of them to Apple Pay by just clicking on it. Somewhat disappointingly, I was taken out of the bank’s environment into the regular Apple Pay “add card” process and had to scan my card, wait for the text message with a security code to arrive, and set it up just like I would have done with any other card. I can imagine that what I wanted is perhaps challenging technically, but it still seemed like an opportunity missed to “surprise and delight” me as a customer. When everything works as expected, the transaction experience is brilliant. However, I already expressed my concerns about the reliability of TouchID on these pages before, and they proved to be true – TouchID does not always work for me when trying to use Apple Pay. While this is not much of an issue in a retail setting, it is not something you want when fighting the crowds to get on a tube or train platform during rush hour in London. As Transport for London confirmed in response to a number of complaints about over-charging, you have to touch in and out with the same device throughout the day to ensure the correct fare is charged; touching in with Apple Pay and out with a card or Apple Watch might result in being charged twice, even though all payments might eventually come out from the same card. The other thing is that Apple Pay quickly conditions you to getting transactions confirmed on the phone. Because TfL has daily and weekly caps, it cannot confirm each transaction instantly. Instead, I was charged 10p when I touched in with Apple Pay, with the balance for the day’s travel being charged to my card much later. While this is understandable and a minor gripe, it still contrasts with the experience of other transactions. None of this is TfL’s fault, which deserves plaudits for continuing to improve and give options to how we pay for travel. However, while I will definitely continue to use Apple Pay at the retailers, I am going to stick with a tried and tested Oyster card or a bank contactless card when travelling in London. It is simply not worth fretting every time I approach the gates whether the technology will work at the speed needed to keep the crowds flowing.

Apple Pay: welcome to the UK!

This week Apple announced that Apple Pay will finally make its debut in the UK. Most of us expected that after the US launch, Canada and the UK would be the next countries for Apple Pay as it expands internationally. Those of us here were hoping it would happen by April, but it looks like it will now finally be arriving in July. The UK market has many ingredients for Apple Pay to succeed. Apple’s market share is over 40%, having climbed upwards in the last 9 months on the back of strong sales of the latest Apple 6 and 6+ devices. And the acceptance environment is rather “contactless-friendly”: about 250,000 merchant locations already accept contactless transactions in the UK, including leading retailers, such as Boots, Tesco, Marks & Spencer, and many others. Importantly, Transport for London has upgraded its infrastructure last year to start accepting regular contactless bank cards, in addition to Oyster, its own prepaid travel card. TfL confirmed that Apple Pay will also work on the London transport network, which should be a significant contributor to Apple Pay transactions in the early days. Most of the leading issuers are also on-board. Customers with cards from American Express, First Direct, HSBC, Nationwide, RBS Group and Santander will be able to use Apple Pay at launch, with the Lloyds Group, M&S bank and MBNA joining later in the year. One notable omission is Barclays, although apparently the two companies are continuing the dialogue. What is not clear yet is the commercial terms between issuers and Apple Pay – everyone remains tight-lipped about it. I would be very surprised though if the UK banks end up paying any transaction fees to Apple. As I already called out in my report on Apple Pay, interchange rates in the UK and Europe are simply not high enough to support any revenue sharing. Furthermore, post Android Pay and the networks dropping charges for their tokenisation services, any wallet fees are looking increasingly unlikely. Most contactless terminals today have a ÂŁ20 transaction limit, which makes sense when you accept contactless cards, which offer no cardholder verification mechanism. It doesn’t make sense for an Apple Pay transaction which uses biometric cardholder authentication via Touch ID. That is, assuming Touch ID works – I’ve been struggling badly with it lately, as my shiny iPhone 6 simply refuses to recognise my fingerprints most of the time. If I can’t resolve it, I might have second thoughts about using Apple Pay, as the last thing I would want is “faffing around” trying to pay with my phone which doesn’t work… The transaction limit in the UK is going to ÂŁ30 in the autumn. And those retailers who upgrade their terminals (at least, the software bit) should be able to decide against imposing any limits for Apple Pay transactions. We’ve had options to pay by phone in the UK for a while now, such as paym, Barclays’ Pingit, PayPal and a few other solutions. Zapp, a mobile payment method that would allow customers to pay directly from their bank accounts, is also due to finally launch later this year. Still, Apple Pay’s arrival is major news, and should give a much needed boost to the UK’s mobile payments scene. Exciting times!

Towards an OS/device-based mobile wallet

Over a year ago, we published a 2014 edition of our annual Top Retail Payment Trends Report (2015 edition is here), in which we distinguished between app-based wallets – majority of mobile payments solutions in the market at that point – and device-based wallets. We suggested that payments would become ever tighter integrated into the device and the operating system (OS) and that we will see the emergence of device-based wallets, “which store securely on the phone a token associated with payment credentials, which can be discovered and summoned as needed by any app or a site reached via mobile browser.” Then Apple Pay came along and demonstrated to everyone the beauty of a payments solution tightly integrated into the OS and the device itself. There is no separate wallet app; customers can configure the solution via the Settings page and store their cards in Passbook. And the token of the credentials can be summoned for an in-store or an in-app transaction. Apply Pay raised the stakes for everyone in mobile payments. The challenge for Google is that the Android ecosystem is nowhere near as tightly controlled as Apple’s. Yet, in the last couple of weeks, we’ve seen a few interesting moves that indicate steps towards OS and device-based wallets in the Android ecosystem. First, Samsung, the leading Android device manufacturer acquired LoopPay, which uses Magnetic Secure Transmission (MST) technology to enable mobile payments at the existing POS devices. Then, Google announced it was buying Softcard’s technology. Finally, the news just emerged that Google would be launching Android Pay at its Google I/O conference in May. LoopPay’s wallet today requires additional hardware, such as phone cases or fobs. I am convinced that Samsung will seek to get away from that and would integrate the technology into its devices. The big question is – why continue to invest into “mag-stripe technology,” and isn’t it a step backwards? It certainly feels that way, although I don’t think it indicates Samsung’s shift away from NFC; my view is that this is a pragmatic move recognising that even with EMV migration underway, the US will continue to accept magstripe-like transactions for the foreseeable future. After all, Visa has also invested in LoopPay back in the middle of last year. The big question with Google’s purchase of Softcard’s IP is whether Google would go back to SIM-based secure element, now that the mobile operators would finally play ball. My guess is that it won’t. HCE gives everyone more flexibility, and leverages the investments the issuers and networks have been making into tokenisation. Visa just announced yesterday that it has been partnering with FIs around the world to enable HCE-based digital services. HCE is also what would enable Android Pay, which would allow third parties to build in payments features into their apps, either for in-app or in-store purchases. Instead of going back to SIM-based SE, I suspect Google will make use of Softcard’s loyalty functionality and will gain access to the MNO distribution networks. According to the announcement, Google Wallet will come pre-loaded on the handsets sold by the operators, which I assume will get paid a distribution fee. As various solutions get tighter integrated into device hardware and operating system, it will be interesting to watch how they would co-exist. Could the latest Samsung Galaxy device support a PayPal app with biometric authentication, LoopPay, Google Wallet and Android Pay without at least confusing the customer? Or are the two giants in the Android ecosystem on the collision path here? Clearly, there is no respite from interesting developments in mobile payments. I am sure we’ll see another wave of interesting announcements next week at Mobile World Congress in Barcelona. I had the privilege to serve as a judge for GSMA Global Mobile Awards, and I am certainly looking forward to the ceremony and the rest of the Congress. I’ll make sure to blog my impressions when I am back. In the meantime, drop me a note if you would like to meet in Barcelona next week.

Google entering UK P2P payments

Last week Google announced that it will be rolling its email based money transfer system to the UK. The feature was launched about two years ago in the US and allowed those with a Gmail account to hover over a $ sign and add money to an email message like an attachment. It is expected that it would work similarly in the UK, with a $ sign naturally replaced by ÂŁ. Why now? Why P2P, and not, for example, HCE-based NFC payments, ahead of the expected Apple Pay launch? We admit we don’t have insights into Google strategies (and if we did, we couldn’t blog about it), but here are some of my thoughts. P2P payments has rapidly become a competitive space in the UK. Consumers can already choose between PayPal and other “wallets” or individual bank-based initiatives, such as Barclays’ PingIt and Natwest Pay Your Contacts. Also, last year, Paym, an industry-wide solution was launched in partnership with banks. Paym recently reported having signed up 1.8 million consumers who transferred ÂŁ26 million. Admittedly, it’s not much yet, but with some banks so far it’s only possible to sign up to receive payments via Paym, but not send. While all these solutions are making more consumers more comfortable with the idea of sending money based on a mobile phone or an email address, at the same time, Google will have to differentiate to stand out from the crowd. One clear differentiator is the email-based approach. While I don’t have specific numbers, my sense is that Gmail is a popular mail service in the UK, and all these customers will now be able to enjoy a new feature. Assuming they like what they see, and start sending money to each other, Google is likely to enjoy increased wallet balances, at least until the recipients are ready to cash out. I also suspect this is a customer acquisition play for Google Wallet, which has not received as much publicity in the UK as it did in the US. Every Google email user can send money, but you do need a Wallet app to accept money. Once Google Wallet establishes a customer base, it can then take on Apple Pay more directly by rolling out its full wallet services to Android users in the UK. With Android representing ~60% share of smartphone users and a growing contactless acceptance infrastructure, the UK market might prove to be an attractive opportunity for Google Wallet.

Apple’s earnings call: an encouraging story about Apple Pay

Yesterday Apple announced its results for Q1 2015: revenue of $74.6 billion, profit of $18 billion over the three months, apparently the largest quarterly corporate earnings of all time. While these numbers are hugely impressive, of course, the payments industry was looking for any hints of Apple Pay performance. This is what we learned:
    • On enabling consumers:
      • Apple sold over 74 million units of phones, mostly iPhone 6/ 6+, which is ~9 million more than expected by the investment analysts. This matters to Apple Pay, as the new phone is a prerequisite to be able to use Apple Pay. This is a global figure, but it still means that there are millions, if not tens of millions of new phones in the US where Apple Pay has been first launched.
      • 750 banks and credit unions have signed up with Apple Pay. Of course, as we discussed in our earlier blog, the number of FIs actually already supporting Apple Pay is much smaller – 54, but the momentum is clearly there. Furthermore, the participating institutions represent over 90% of credit card transaction volumes.
    • On enabling merchants:
      • Tim Cook, Apple CEO admitted he was “positively shocked” at how many merchants were already supporting Apple Pay and revealed that POS suppliers were reporting “unprecedented demand” from merchants. Undoubtedly, the ongoing EMV migration is helping stimulate that demand for new terminals.
      • USA Technologies announced a nationwide rollout of new acceptance points for Apple Pay. This will add about 200,000 acceptance points, “bringing the advanced mobile payments service to owners and operators of coffee brewers, vending machines, kiosks, laundry equipment, parking pay stations and other self-serve appliances.”
    • On actual usage:
      • Apparently, Apple Pay is responsible for $2 out of $3 spent on Visa, MasterCard and American Express contactless transactions. While the specific statistics were not revealed, and two thirds of not much is still very little, Apple certainly demonstrated ability to acquire market share in a short period time from competitors such as Google Wallet and Softcard.
      • Apple Pay represents nearly 80% of mobile payment transactions at Panera Bread, while Whole Foods Market had seen an increase in mobile payments by more than 400% since the launch of Apple Pay.
    • On evolution and future plans:
      • Tim Cook acknowledged the opportunities around both in store and in app use cases of Apple Pay and that market specifics will determine which will be more important in any given geography.
      • As expected, Apple Pay will be expanding internationally. The management acknowledged that each market is different and will require “heavy lifting to scale,” but confirmed they were ready to tackle the challenge.
Tim Cook concluded that 2015 will be the year of Apple Pay. This might be debatable, but Apple Pay certainly had a very encouraging start. This also further validates Celent’s perspective we articulated in the latest edition of our Top Trends in Retail Payments report, which was published yesterday and is available to our clients.

Apple Pay: A few surprises – or are they really surprises?

Apple Pay continues to provide excitement to many in the industry who are looking for signals indicating that Apple Pay is either doomed or is becoming a mass-scale success. In reality, it’s neither at the moment – it’s still early days. A few recent stories also caught my eye. At first glance, they seemed a little surprising, although I don’t think they should be. The first was the InfoScout blog discussing their research that 90.9% of iPhone 6/ 6+ users have never tried Apple Pay, and only 4.6% of those who could use Apple Pay during Black Friday, actually did, which has prompted some commentators to announce the death of Apple Pay. Considering that smooth consumer payment experience is one of the major Apple Pay’s attractions, low usage might appear a little surprising. However, if you think about the shortage of merchant locations, lack of awareness which merchants would accept the transactions, general stress of shopping on Black Friday and the fact that we are talking here about “normal” consumers (albeit early iPhone 6 adopters), not payment geeks, it starts to make more sense. Various other surveys found that consumers who have used Apple Pay, compared it highly favourably to using a traditional plastic card. And according to the same InfoScout blog, of those who have not used Apple Pay, 31% said they didn’t know if the store accepted it and 25% said they simply forgot – factors that will fall away over time with more training, communication and experience. Bank of America recently said that 800,000 of its customers have signed up with a total of 1.1 million accounts. The second was a recent story in Digital Transactions that there are now 54 banks and credit unions supporting Apple Pay. Only 54? Didn’t the announcement from Apple in October state that it signed up another 500 FIs in addition to its launch partners? Well, there is clearly a difference between signing the paper and actually supporting customers and their cards from technical and operational perspective. Still, it is encouraging to see that the number of institutions continues to grow and includes issuers across the spectrum, from the largest banks to small(-ish) credit unions. My final surprise was data from research that ACI Worldwide conducted at a recent National Retail Federation (NRF) show. ACI surveyed 200 participants, 85% of whom were based in the US and over half represented merchants. 47% of respondents expected that Apple Pay would “win the mobile wallet war” with Google and PayPal being other main contenders; only 6% opted for MCX. In our last year’s report assessing Apple Pay’s prospects, we predicted that the US merchants would be the most likely major barrier for Apple Pay’s success. However, if merchants start to believe in Apple Pay, they might start switching on the contactless capability on the new terminals they are installing as part of EMV migration. And if that happens, then mobile payments might arrive sooner than even the most optimistic of us expected.