What if Apple Pay went cha-ching and nobody heard it?

A billion transactions, 250 million users, 85% over there.

From a note to subscribers posted Thursday by Loup Ventures' Gene Munster:

Over the last three June quarters, Apple has reported y/y growth of 500%, 400%, and 300%, respectively, bringing the total transaction number “well over 1 billion” (Source: Apple). With the continued expansion into new markets and new partnerships with banks, we expect transaction growth of 200% over the next 12 months.

On Apple’s latest earnings call they shared data points that allow us to back into updated user metrics.

  • Over 1 billion cumulative transactions in Jun-18, a 3x increase in transactions y/y (source: Apple).
  • Apple Pay now has over 4,900 bank partners (source: Apple).
  • We estimate that Apple Pay now has over 252 million users, which equates to 31% of the active iPhone base (source: Loup Ventures).
  • Adoption of Apple Pay continues to accelerate exponentially overseas compared to the U.S., with 85% of users being international vs. 15% in the US (source: Loup Ventures).

Apple has several advantages to brand the iPhone as the premium digital wallet given its ability to integrate payments into both mobile and desktop operating systems, use its brand to win accepting retailers and supporting banks, and reassure users that transactions are secure and private. Separately, Apple Pay is the only digital wallet with all five payment pillars: mobile, desktop, in-app, peer to peer, and point of sale.

My take: Why am I still the only shopper I know in an American city of 17,000 who buys his groceries with Apple Pay? Why, five years later, do the cashiers still treat me as a novelty? According to Munster, that's because nearly all the other Apple Pay users are overseas.


  1. John Blackburn said:
    Love using it, but can rarely do so in the States. Overseas, though, it’s seemingly everywhere!

    August 10, 2018
  2. Fred Stein said:
    Repeating myself. Apple is a decade-plus thing. I struggle to get my nieces who use iPhones to get it so I can easily send b-day presents of cash.

    The advantage are so compelling. It leaves no trace for anyone to steal account numbers. Who cares if an App or Web site has lax security or is a complete fraud. They can only steal one transaction. Payment by Apple Watch while on the go with hands full – EZ. It’s the fastest at the check-out lane and most reliable for merchants.

    And Philip, you are a novelty. Rejoice!

    August 10, 2018
  3. Phil Service said:
    My experience out here in the hinterlands (Flagstaff, AZ) is much the same as yours. I use Apple Pay all the time to by groceries at Safeway. It still seems to be a novelty. I thought perhaps it’s because I use my Apple Watch, rather than pull my phone out of my pocket. But, as far a I can tell, just about everybody is still using conventional credit or debit cards, or cash. BTW, I am gradually seeing more and more Apple Watches in this part of the world, especially on women.

    August 10, 2018
  4. Gregg_Thurman@me.com said:
    I felt when Apple Pay was first announced that it would eventually replace credit cards, with Apple Pay becoming a “credit card” onto itself. When Apple Cash was introduced my belief was cemented.

    With zero transaction loss, due to fraud, Apple could churn its surplus cash 12 times per year, earning 1% per month, instead of the 1.5% per year it earns now.

    The banks wouldn’t care as long as they continued to get their 0.5% per transaction.

    The losers: VISA, MasterCard, American Express, Discovery, Merchant Services firms, et al.
    The winners: merchants whose fees would drop 1% (or more) per transaction.


    August 10, 2018
  5. Reader Walter Millican writes:

    Where I live in SE New Hampshire (Dover is about 25k people), I don’t see a lot of people using Apple Pay, but I do see other people using it once in a while at the store. And the local Hannafords apparently had enough people trying to use it in their self-checkout lanes and having problems that they put a little taped notice on the terminals NOT to use Apple/Google/Samsung Pay on them. The regular cashier lane terminals still accept Apple Pay.

    A good number, possibly a majority, of the larger local merchants take Apple Pay now, and random smaller ones. It’s still very rare in restaurants though — only the local Olive Garden table terminals will take it, and that’s a recent change. And Panera takes it, and probably the local McDonalds, but that’s more fast-food.

    Success with merchants supporting Apple Pay is still occasionally random though — I tried to pay for my car service a couple days ago at the local Subaru dealer, and it said “NOT SUPPORTED” when I presented my Bank of NH debit card on my Apple Watch, though they said other people had used Apple Pay without problems. Usually when this happens, my Bank of America Mastercard will work ok using Apple Pay at the same terminal, so it’s apparently something to do with the bank’s clearance network. Using the physical debit card worked fine on the terminal, though.

    Strangely, I heard an anecdote the other day from a waitress at the Olive Garden about a friend who had a problem with a “drive-by” payment in a local store, where the person’s Watch or pocketed iPhone somehow paid for a transaction at an adjacent lane when the iPhone user wasn’t even using it for a payment. Not sure how this could happen by accident, actually — the Watch takes a double-click on the side button to prime it to pay, and iPhones normally require a TouchID confirmation, I think. (I never use my iPhone for Apple Pay, since the Watch is so convenient.)

    I don’t generally get comments anymore when I use Apple Pay on my watch, though every once in a while a cashier will say something, usually asking whether it’s worth buying a watch to use it that way. So I think it’s becoming a bit more mainstream, even in my relatively suburban/rural area. I do see a lot of people with Apple Watches around, so I’d assume at least some of them use Apple Pay as well.


    August 13, 2018

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