We were no more than moments into the Opening Summit of Day 1 of Cartes, when an auditorium of pens moved simultaneously to paper to capture the panellists’ views on Apple Pay. With Oyvind Rastad, Chairman of Eurosmart confessing that this is the third year running he has predicted that “next year will be the year of NFC” – will Apple Pay finally prompt the industry to deliver in 2015?
Possibly – in France at least. Francois-Xavier Godron, Director of the NFC Program at Orange shared some impressive statistics regarding the 30% of Point of Sale terminals that are now NFC-enabled in France. Having led the way with EMV migration over ten years ago, France may now be in a position to wear the yellow jersey in the mobile payments race.
Apple’s global brand power is such that the interest Apple Pay has inspired in the consumer will reverberate around the mobile payment ecosystem, leading June Felix, President of Europe at Verifone to note that “Apple Pay has done something wonderful for our industry.”
The truth is, that for many consumers, the press attention that Apple Pay has received means that the solution is mobile payment. This is an exciting development for this fragmented industry, which has so far struggled to gain enthusiasm amongst consumers or widespread adoption with merchants. Apple’s move will prompt merchants to equip terminals with NFC capability, and force Mobile Network Operators (MNOs) to consider alternative solutions for non-Apple platforms. Needless to say, these must strike the all-important balance between convenience and security.
However, Apple is also arguably holding the ‘golden snitch’ in terms of trust. Although success can propel the wider ecosystem forward, any security threats Apple Pay faces will be high-profile, and shake the reputation of the industry, setting it back dangerously against a backdrop of recent progress.
There can be no doubt that Apple Pay has breathed fresh air into the mobile payments ecosystem and will prompt a flurry of innovation from collaborators and competitors alike. Issuers must extend their highly secure backend infrastructure to cover all these different approaches. The real risk for this group of banks would be to back just one horse.