A Look at Apple’s Evolution in the Payment-Processing Market
Apple's Entry into the Peer-to-Peer Mobile Payments Market
Apple has made rapid strides with Apple Pay
In the prior parts of this series, we discussed how a possible peer-to-peer money transfer feature launch by Apple (AAPL) could have an impact on the overall payment-processing industry. Apple entered into this market last year with its Apple Pay service.
Apple revolutionized this space as its one-touch checkout feature simplified the whole payment process. In this regard, Apple partnered with payment networks such as Visa (V), MasterCard (MA), and American Express (AXP).
In the last year, Apple has integrated Apple Pay with more than 1 million US retail locations. Earlier this year, Apple announced that Best Buy (BBY) would start supporting the Apple Pay service.
More recently, Apple announced that some Starbucks (SBUX) stores would start accepting the Apple Pay service by the end of this year, with the complete rollout of Apple Pay at 7,500 Starbucks stores happening by the end of 2016.
Apple also seems to be getting aggressive about expanding the service into international markets. After penetrating the US market, it has entered into the UK, Canadian, and Australian (EWA) markets as well.
Apple could disrupt the person-to-person payments market with innovative solutions
Apple is now set on entering the peer-to-peer money transfer market. Currently, this market is quite fragmented, with PayPal’s (PYPL) Venmo and Square as the main individual players. However, as the chart above shows, their shares in this market are only 19% and 10%, respectively, according to a report from the Wall Street Journal citing Aite Group.
Apple has a knack for disrupting the business of established players with its own innovative solutions. It could do the same to the established players in the person-to-person payment-processing market.
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