Apple Pay – The Disruption and Prospects for India

As the dust settles after the launch event of the iPhone 6 and the Apple  watch, rather than the devices themselves, Apple Pay and the Apple SIM have in fact emerged as the key highlights in Apple CEO Tim Cook’s recent Keynote speech. While the iPhone 6 and 6 Plus are bigger, faster and have better displays the improvements are incremental at best. And while the Apple Watch is just a start in a whole new ecosystem of smart wearable technology, the reception was not that great, evidence of this is the fall in the share price of Apple on the eve of the launch event.
The thinking behind increasing the phone size was quite evident, with users migrating from browsing on their PC’s to browsing on their smartphones. Apple’s 4 inch displays were most definitely fighting a losing battle there. But, the bigger business impact may come from Apple pay, Apple’s new mobile payment solution. The iPhone 6 and 6 Plus weren’t disruptive innovations, however, Apple pay might end up revolutionizing the world of plastic currency.
Apple pay is a one-tap payment method which utilizes Near Field Communication (NFC). NFC has been around for a few year’s, in India it has been used so far only to make two devices ‘ talk’. But, in Japan it is the preferred way to make hotel payments and  buy subway travel passes/tickets. With Apple pay, swiping your credit card will be a thing of the past, at least in the United States.
Learning from the Google wallet fiasco, Apple has realised that to open a new market a pilot-scale programme will not work. Apple has realised that for mass acceptance they will need mass availability. And, in doing so the American tech Giant has tied up with Visa, Mastercard and Amex. Apple has also tied up with 220,000 merchants in the United states alone, this includes big names such as McDonalds, Subway and others. Apparently 500 more banks would support Apple Pay early next year!
Typically mobile wallets store credit-card/debit-card details and reflect them at the time of purchase. Leaving sensitive data open for exploitation on your smartphone. Apple pay takes the credit card data and creates a unique user profile, then using their proprietary payment system a one-time payment slip is generated per transaction. All the user has to do is wave or touch their smartphones on the POS (point of sale) reader and enter their pin or fingerprint through  Touch ID. This also eliminates the need for merchants to store credit card details reducing the chance of theft and misuse.  A major drawback in the Apple pay system is the need for a retailer to invest in POS readers, small retailers may not find it viable to invest in the readers if they are exorbitantly priced.
Apple pay is much more than just another mobile wallet its a step in the direction of creating a secure digital profile for a user, this digital profile currently will give you banking access and other basic features but the possibilities are limitless. Apple may eventually be able to aggregate all the data an individual might need to function in the digital platform, including passports, bank documents, driving licences etc.


Today the average Indian shopper has overcome their prejudice towards using digital currency, this is obvious from the growth of e-commerce in India. Apple Pay will just add to this convenience opening up a whole realm of possibilities for the Indian consumer.
However, there are certain obstacles that have to be handled before apple pay is a reality in India. A key challenge in the implementation is the readiness of various players to interoperate on a large scale, this co-operation is essential to create a seamless ecosystem to ensure the best possible consumer experience. Regulatory approval for such a system in India may also be a challenge that will affect any plans Apple or others cook to bring such a service to India.
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