Existing card-based tap-and-pay systems are already widespread and easy to use.
1 minute read
The thing I’ve missed most since switching to an Android phone from iPhone a few months back is the ability to use my device to tap and pay for purchases in stores.
Just kidding. I haven’t missed it all. I actually forgot that phones are able to do that nowadays.
I’m a typical Canadian in this respect, according to reports. Many of us just haven’t found a reason to use our phones in that way. Canadian businesses may be behind in their adoption of a lot of technologies, but they’re actually quite well advanced with their payment systems. Far more so than their U.S. counterparts.
Tap-and-pay cards and merchant terminals are therefore very common in Canada. More than 80 per cent of stores in the country have terminals equipped with near-field communications – the tech that makes tap-and-pay work – according to Google, which launched Android Pay here this week.
So-called contactless payments are exploding as a result, with 120-per-cent growth in the previous fourth quarter alone. Google doesn’t break that stat down, but presumably the vast majority of those payments are being made via tap-and-pay debit and credit cards.
This is something of a problem for Android Pay, Apple Pay and Samsung Pay, all of which are now available in Canada.
Phones do offer security and convenience, since they can store and centralize a number of debit, credit and loyalty cards, but they don’t necessarily do much that isn’t already possible – and that isn’t already incredibly simple. Tap-and-pay cards are just about the easiest technology to use, which is why their popularity is exploding.
Reports suggest Apple Pay, the eldest of the three systems, isn’t doing well. Loup Ventures analyst Gene Munster estimates only 13 per cent of iPhone owners have used Apple Pay, which is disappointing to even conservative forecasts.
I wrote about some of these underlying challenges when Apple Pay was first announced back in 2014. Mobile payment systems will continue to face uptake difficulties for as long as people have to carry physical ID cards and for as long as cash is still an important thing to have on hand.
Until ID and cash are fully digitized and eliminated, we’ll always have a need to carry a wallet. And if we have a wallet, we might as well have cards that let us make payments too.
The tech giants effectively want people to shift their payment capability from one pocket to another. So far – and for the foreseeable future – not many people are finding value in doing that.