back to article Apple Pay is a tidy payday for Apple with 0.15% cut, sources say

Banks and credit card providers are paying a hefty price to be part of Apple's new Pay system, unveiled by boss Tim Cook earlier this week. According to the Financial Times, which cited two people familiar with the terms inked between Cupertino and interested parties, 15 cents of a $100 purchase will be pocketed by Apple. As …

  1. billse10

    what's the date today?

    not April 1st, is it?

    "Apple said it wouldn't access any payment data" - yeah, right, and loads of brokers said clients wouldn't lose money with Bernie Madoff.

    1. Mike Bell

      Re: what's the date today?

      You forgot the tinfoil hat.

      Apple talked this up in their recent presentation of Apple Pay. A differentiator that sets them apart from the likes of Google. If that was a lie, don't you think the card issuers would have something to say about that? And what would be the benefit to Apple in any case? There's nothing in it for them to track the kind of purchases that you make. That's not their business model.

      1. Yet Another Anonymous coward Silver badge

        Re: what's the date today?

        >there's nothing in it for them to track the kind of purchases that you make.

        So everybody else on the internet is wrong?

        >That's not their business model.

        Their current business model is to sell phones that are 2 years behind Samsung's offerings to people who already have a previous model of the same phone. It's possible that they might want to start looking for a new business model

        1. Mike Bell

          Re: what's the date today?

          @Yet Another Cowardly Anonymous Mouthpiece

          Not 'everybody else on the internet' is making the ludicrous claims that you hold dear to your heart.

          Samsung make good stuff, but they don't make iPhones. E.g. the fingerprint sensor on the iPhone is light years against Samsung's rather antiquated implementation. To the best of my knowledge, Samsung do not have an agreement with major card issuers to partake in fingerprint-authenticated payments.

          This tedious 'Apple just copy Samsung' crap is trollish nonsense. Give it up already.

          1. Yet Another Anonymous coward Silver badge

            Re: what's the date today?

            >Not 'everybody else on the internet' is making the ludicrous claims that you hold dear to your heart.

            Everybody else on the internet does think that knowing someones purchasing patterns in real time is worth money, especially if the persons are young, rich and fashion conscious iPhone owners.

            iPhones may have some features better than their competitors and some worse, but they are no longer the only game in town that they were when the iPhone originally launched. They might soon be making more money by being a credit card processor than a phone maker.

          2. Fluffy Bunny
            Alert

            Re: what's the date today?

            "Samsung do not have an agreement with major card issuers to partake in fingerprint-authenticated payments."

            Nobody else does either, because it makes no sense. Customers use NFC to do quick (near instant) transactions of small value. If the value is higher, they need to enter their PIN, which slows things down slightly. If a customer had to enter a fingerprint, it would slow them down even more. I simply can't see anybody wanting to do it.

            1. You have not yet created a handle

              Re: what's the date today?

              "If the value is higher, they need to enter their PIN, which slows things down slightly. If a customer had to enter a fingerprint, it would slow them down even more. I simply can't see anybody wanting to do it."

              It takes less effort (and is more secure) to hold a phone with your thumb on the reader than it does to enter a PIN in the machine.

              Old Way:

              Get wallet out

              Find card

              Insert card into reader

              Wait for till to do it's thing

              Enter PIN

              *Correct PIN if you entered it wrong*

              Hit Enter

              Wait for approval and remove card once told to do so

              New Way

              Remove iPhone from pocket.

              Choose payment card from Passport app on screen.

              Present to reader in the usual way you hold a phone (thumb on front, fingers behind).

              Put phone back in pocket.

              New way seems a lot less effort to me.

              1. rotmos

                Re: what's the date today?

                Better way:

                Get wallet out

                Find real money

                Give real money to shop assistant

                Get real money (change) back (if applicable)

                Put real money (change) in wallet (if applicable)

                Done

                Apple, Google, NSA, Visa etc safe. No one knows what, where and when you have shopped (except the shop assistant who has forgotten you the same second the money has been received).

            2. Anonymous Coward
              Anonymous Coward

              Re: what's the date today?

              "I simply can't see anybody wanting to do it."

              Normally yes, but the you vastly underestimate the herd behaviour of iSheep.

      2. Eddy Ito Silver badge

        Re: what's the date today?

        It's a differentiator for now. I haven't been able to find the T&Cs for Apple Pay. If it's their standard boiler plate we can assume they reserve the right to change whatever they like whenever they like so while they may roll it out as we won't track anything there is nothing to stop them from starting at any point in the future.

      3. Hipsterina

        Re: what's the date today?

        "And what would be the benefit to Apple in any case? There's nothing in it for them to track the kind of purchases that you make."

        Have your eyes been averted as the payments made by Shhhh-secret-squirrel agencies to those who help feed their data lust have been revealed?

        And Apple just says, "Yessir, MyPleasureSir", when everyone else is getting cash for "private citizens' data"?

        1. DougS Silver badge

          @Hipsterina

          If you're going to be an Apple hater, at least think logically instead of coming up with the stupidest argument possible.

          Do you really think the NSA pays anyone for the data they give up? They make them an "offer they can't refuse". Anyway, what is the simplest way for them to get the payment data, to get it from Apple who doesn't necessarily even know what merchant something is being purchased from and what item is being purchased (I don't know what info the payment terminals will actually provide aside from the cost and some sort of transaction ID)

          No, the easiest way is to get it from the banks, who not only process Apple Pay payments, but all credit card, debit card, Paypal and so on. The banks already have to provide the government with reams of info, and no one squawks too much about it because people know the banks have to provide this information because "terrorism".

    2. Philip 4

      Re: what's the date today?

      Apple billions are not made by exploiting people's data. They are made my flogging very expensive phones, tablets, computers and, occasionally, music players.

  2. Frank N. Stein

    Apple has managed something with Apple Payments that none of the others have since it became available, when? Apple didn't invent NFC any more than they invented the Smart phone or Tablet, but they do seem to have a knack for improving upon existing tech in a way that gets Enterprise Businesses to play ball with them.

    1. John Riddoch

      I don't think there's a significant "improvement" on the tech, just better marketing of it and, possibly more significantly, improved trust level. Regardless of your views on Google, the iPhone platform is more locked down and hence more likely to be trusted by banks & retailers.

  3. Anonymous Coward
    Anonymous Coward

    I don't see Apple Pay becoming much of a thing ever since Walmart said they wouldn't support it.

    1. Thomas Wolf

      Aren't most Walmart customers Android owners?

      1. Purple-Stater

        "Aren't most Walmart customers Android owners?"

        No. Consider that more than 40% of Americans still do not even own smartphones.

      2. Hipsterina

        "Aren't most Walmart customers Android owners?"

        Do you mean in the same way that most iThing users are self-reflection-gazing tossers? I couldn't possibly comment.

        1. whatevs...

          "Do you mean in the same way that most iThing users are self-reflection-gazing tossers? I couldn't possibly comment."

          Well you escalated that quickly. I guess that makes you a cheap, judgmental and sanctimonious prick. I wouldn't know of course...

      3. Anonymoist Cowyard

        No, most walmart customers are iPhone owners, desperate to prove they have made it in life because of their choice of phone.

        Android owners are just the ones all around that dont feel the need to buy status symbols, they don't care what others think.

        1. Sean Timarco Baggaley

          "Android owners are just the ones all around that dont feel the need to buy status symbols, they don't care what others think."

          Then would you mind awfully explaining why you and your peers insist on telling us, over and over and over and over again, at tedious fucking length, how much you "don't care what others think" every bloody time there's a news story about Apple?

          1. Hipsterina

            "Then would you mind awfully explaining why you and your peers insist on telling us, over and over and over and over again, at tedious fucking length, how much you "don't care what others think" every bloody time there's a news story about Apple?"

            Because the funniest thing about Apple flaunters is their conspicuous flauntiness.

            And it's hilarious.

            Remember those oh-so-coolsters who flaunted shell-suits a few years ago, while others sniggered at their flauntiness?

            Don't begrudge those who aren't hipsters their moments of mirth.

          2. Michael Thibault
            Thumb Up

            >you and your peers insist on telling us, over and over and over and over again, at tedious fucking length, how much you "don't care what others think"

            Bingo! I suspected that there was a pattern here, but until now I've been unable--you know--to put my finger on it. Thank you, endlessly, STB!

            (I'd use an icon displaying a very different digit, flipped in the direction of the twitcherati, if one were available--but no such luck. Anyway, I'm off to the agora so that I can posture and flash my Apple tat. I'd add 'and to wind up the twitcherati', but apparently they never need winding, never need winding, never need winding. Tah!)

          3. whatevs...
            Pint

            "Then would you mind awfully explaining why you and your peers insist on telling us, over and over and over and over again, at tedious fucking length, how much you "don't care what others think" every bloody time there's a news story about Apple?"

            Best. Comment. Ever.

            1. Anonymous Coward
              Anonymous Coward

              It's just soooo easy to get iFans foaming at the mouth by insinuating that their icon (iCon?) isn't the be-all and end-all. It's like shooting iFish in a barrel and it's pretty fun.

  4. Anonymous Coward
    Anonymous Coward

    A charge to pay a charge after being charged £600 to purchase the device you use?

    What's wrong with a debit card? Or cash?

    Fcuk Apple

    1. Chad H.

      There is no charge to the user.

      The "charge" is paid by the merchant processor, who is already charging the merchant about 2.5% of your purchase price.

      1. Eric Olson

        You forget one thing...

        That charge is called overhead, and like most other types of overhead, the cost is factored into the retail price.

        There is very much a charge to the user, though it would be spread out among all customers, not just the ones who use Apple Pay. These places aren't charities and are hoping that by being of the first-use bandwagon, they can skim a few extra sales from their competitors. But if this becomes widespread (or rather, this model), it means that like credit card transaction fees, they will be baked into the sticker price of each and every good or service for sale, regardless of if you pay with cash, credit, check, Apple Pay, or bits of string.

      2. Hipsterina

        'There is no charge to the user.

        The "charge" is paid by the merchant processor, who is already charging the merchant about 2.5% of your purchase price.'

        And the funding comes from a coffee-break whip-round amongst employees, topped up by generous donations by shareholders?

        Well, that's much more enlightened than the usual practice of adding any charges straight onto the amounts charged to punters.

        1. Chad H.

          >>>> funding comes from a coffee-break whip-round amongst employees, topped up by generous donations by shareholders?

          >>>>Well, that's much more enlightened than the usual practice of adding any charges straight onto the amounts charged to punters.

          The Punter in this case is the store (not the iPhone user), and they're just paying what they'd pay anyway to have the card machine.

          1. Fluffy Bunny
            Alert

            "and they're just paying what they'd pay anyway to have the card machine." .... and passing it straight on to the customer with profit on overheads.

  5. David Kelly 2

    "Tidy" Payday?

    Credit card clearing houses skim an average of 2% off every transaction so out of $100 they take $2 off the top (merchant gets $98). Then out of that $2 for facilitating the transaction more securely Apple gets $0.15, and somehow Apple is the greedy bad guy?

    1. Eric Olson

      Re: "Tidy" Payday?

      I think a valid question is what value add is Apple providing? You could argue (mostly with a straight face) that the Visas and MasterCards of the world are charging a fee for providing infrastructure, prompt payment, and payment integrity to the process by acting as a middleman to confirm that the CC is legitimate, it has an available balance, and that it wasn't involved in fraudulent activities seven states and fifteen clones ago.

      Apple is just providing a key that unlocks a door to new locks that still need to be unlocked by the banks and credit processing firms. They are little more than an electronic version of a piece of plastic with a magstripe or chip that lets the retailer start the process of confirming payment. So even 0.15 cents on the dollar seems a bit steep for something that is almost entirely for the benefit of the consumer.

      1. Chad H.

        Re: "Tidy" Payday?

        My understanding is the thumbprint sensor authorises the payment on the phone. Thats the difference between me being a refusnick, and taking it up. I want all my payments explicitly authorised by me either by PIN or some other fashion like a thumbprint.

  6. Anonymous Coward
    Anonymous Coward

    Nice strategy (potentially)

    Not bad at all. By not being greedy, it appears Apple now has the potential to pocket a large wad of cash. Fifteen cents in 100 dollars, locally, probably covers Apple's costs, while blocking our greedier entrants. If it goes global.....

  7. Guz

    15%!?!?!?!?! Are they out of their minds!!!

    Holy Crap Batman!!!

    That's the worst processing rate I've heard of until now. Discover cards was the highest at my place of business at 10%. Normal credit card (Visa, Master Card, etc) run at 7%, debit cards at 6%.

    I know for sure when I tell my boss (the owner) this, he blow a gasket. Heck, he might even get rid of his iPhone (he was talking about getting the 6 the other day).

    1. Anonymous Coward
      Anonymous Coward

      Re: 15%!?!?!?!?! Are they out of their minds!!!

      You are stupid.

    2. Chad H.

      Re: 15%!?!?!?!?! Are they out of their minds!!!

      its not 15%.

      Its 0.15% of the total price, taken from the 2.5% the merchant already pays.

      Sounds like you're overpaying something serious for your processing rates.

      1. wub

        Re: 15%!?!?!?!?! Are they out of their minds!!!

        You folks keep repeating the phrase "... from the 2.5% the merchant already pays." I'm not entirely sure you know what that means.

        The merchant pays the clearinghouse, sure. Apple's 0.15% will never affect us, the ultimate customers of the merchant, right? After all, the merchant already pays the supplier, the utility companies, the rent on their building space, taxes and all that sort of stuff out of the price we pay for the merchandise. None of these costs apply to the clearinghouse, since they don't have to pay rent, labor or any other costs, right? They are just middlemen who move something from point A to point B and keep a bit for themselves. So of course, they would never need to raise prices to cover increases in any of those costs. Since no one would ever raise the price to their customer, it will never matter what Apple takes out for themselves.

        Or at least, that's what I keep hearing when y'all keep saying "... from the 2.5% the merchant already pays."

        1. Chad H.

          Re: 15%!?!?!?!?! Are they out of their minds!!!

          >>>>The merchant pays the clearinghouse, sure. Apple's 0.15% will never affect us, the ultimate customers of the merchant, right? After all, the merchant already pays the supplier, the utility companies, the rent on their building space, taxes and all that sort of stuff out of the price we pay for the merchandise. None of these costs apply to the clearinghouse, since they don't have to pay rent, labor or any other costs, right? They are just middlemen who move something from point A to point B and keep a bit for themselves. So of course, they would never need to raise prices to cover increases in any of those costs. Since no one would ever raise the price to their customer, it will never matter what Apple takes out for themselves.

          None of these costs are significantly effected by Apple's system. The cost to the Merchant is exactly the same as it would be if they didn't accept apple pay at 2.5% or so.

  8. Schultz
    Devil

    Weather balloon from the credit card companies

    But why it only applies to every $100 spent remains a mystery to me. should we expect a lot of $99.99 special offers in the near future?

    1. VinceH Silver badge
      Joke

      Re: Weather balloon from the credit card companies

      You seem to have selected the wrong icon - hence the downvotes from those who don't get it. Try this one -->

  9. bussdriver

    I'm not in opposition to Apple's fee.

    I don't own their phone and I do not like paying electronically.

    Everybody who accepts plastic payment MUST pay a high % of the sale to the processor and the credit company. It is a privatized tax which nobody seems to know about because ALL pricing automatically includes it (but sales tax is itemized) and one reason for this is the legal agreements the companies push worldwide is to BAN you from telling customers that they are paying almost 3%. If given the freedom to pay in cash without penalty, I would ditch plastic and go to cash to save a few %... but retailers are forbidden from allowing you to do this. Apple most likely got a cut on the card processing so the 0.15% is probably not in addition to the existing fees. Glancing at the overview with my processor, I don't have to pay anything extra for Apple Pay - which means the bank or processor is eating that 0.15%.

    1. Anonymous Coward
      Anonymous Coward

      Re: I'm not in opposition to Apple's fee.

      " bank or processor is eating that 0.15%."

      ... and happy to do it, because they will save way more than that much on the fewer fraud cases that will occur due to the technology Apple brings to the table. Everyone in the payment chain wins, and the customer is unaffected price wise.

      The loser (note spelling) is Google and anyone else who thought they were going to data mine the customers.

      I could become an Apple fan just because they have chopped Google off at the knees here!

      1. Hipsterina

        Re: I'm not in opposition to Apple's fee.

        "they will save way more than that much on the fewer fraud cases that will occur due to the technology Apple brings to the table"

        So, buying and selling selfies is specifically excluded?

    2. VinceH Silver badge

      Re: I'm not in opposition to Apple's fee.

      Everybody who accepts plastic payment MUST pay a high % of the sale to the processor and the credit company.

      [...]

      If given the freedom to pay in cash without penalty, I would ditch plastic and go to cash to save a few %...

      Don't kid yourself that paying in cash doesn't also involve paying a fee. A lot of the cash a business receives will get banked and, here in the UK at least (and I'd imagine elsewhere), most banks charge a small percentage on business accounts for paying in cash. It may not be as much as the fees charged for handling plastic, but it's still a fee nonetheless.

      1. Chad H.

        Re: I'm not in opposition to Apple's fee.

        >>>>Don't kid yourself that paying in cash doesn't also involve paying a fee. A lot of the cash a business receives will get banked and, here in the UK at least (and I'd imagine elsewhere), most banks charge a small percentage on business accounts for paying in cash. It may not be as much as the fees charged for handling plastic, but it's still a fee nonetheless.

        Not just that, theres also the cost of potential employee fraud skimming from the top. Transactions not run up, notes going missing, etc.

        1. John Brown (no body) Silver badge

          Re: I'm not in opposition to Apple's fee.

          ...and for the larger stores, paying for the security van to collect the daily takings and/or deliver any required coins. Agreed it's probably not as much as plastic payments overheads, but I'm sure it mounts up. Smaller retailers don't have the power the larger ones do and so pay per transaction on the business bank accounts too.

    3. Eric Olson

      Re: I'm not in opposition to Apple's fee.

      There is no such thing as a free lunch. Even cash has a cost associated with it. For example, I worked at a retail chain years ago as a supervisor and one of my jobs was to take the cash and coins from the tills from the prior day, stock up our reserves in smaller denominations so that we could account for the fact that ATMs only spit out $20s and that the type of retail establishment we were meant that customers used us to break them into smaller bills ($2.50 item becomes $17.50 in change), and then place an order for rolled coins and singles from our local bank. Then once that was complete and the morning rush was done, I would drive over to the bank with the surplus, pick up the order, and return to the store with the cash and coins, fill up the till trays that needed it, and place the rest in the safe.

      Between the counting, ordering, and driving, that was about an hour of my day. As I was paid hourly, it was a daily cost, in addition to the fees charged by the bank for the coins and bills (separate charge). And it usually seemed that without fail I would come back to a store filled with a long line of customers upset that they weren't getting their coffee in 2 minutes, which meant we always needed to keep an extra hand around for an extra hour so I could complete my duties (albeit at a lower rate than my own).

      Larger retail chains contract out to firms that have armed guards and armored vehicles to transport the cash to a processing center.

      And then there is the cost associated with the increased service time required for a cashier to handle transactions that are conducted in cash rather than a swiped card. Not as bad as waiting for the 75 year old check writer, but still a time sink. And there is always the chance that handling all that cash will increase the absentee rates due to more employees out ill as well as a slight increase in the opportunities for theft-as-a-servant, though most retail operations have figured out how to track tills in a way that makes it hard to get away with such a crime.

  10. nsld

    This is nothing unusual

    Pretty much all closed systems take a cut of the transaction fee to increase ARPS. Its been common practice for years.

    Of course apple won't track the actual payment but it will track the activity either side to analyse shopping habits and that data is valuable, again they have been doing that for years as does everyone else.

    It will be interesting to see if acquirers place a per transaction limit as they do with contactless payments 0.15% of £20 is a lot less exciting than an open limit.

    1. Mike Bell

      Re: This is nothing unusual

      Of course apple won't track the actual payment but it will track the activity either side to analyse shopping habits and that data is valuable, again they have been doing that for years as does everyone else.

      That is in direct contradiction to what Apple stated at their keynote event:

      We are not in the business of collecting your data. And so when you go to a physical location and use Apple Pay, Apple doesn't know what you bought, where you bought it, or how much you paid for it. The transaction is between you, the merchant and your bank.

      If the above statement is true, they have no means of doing what you say. The new tokenisation technology will not allow that to happen.

      1. wub

        Re: This is nothing unusual

        """ Of course apple won't track the actual payment but it will track the activity either side to analyse shopping habits and that data is valuable, again they have been doing that for years as does everyone else.

        That is in direct contradiction to what Apple stated at their keynote event:

        We are not in the business of collecting your data. And so when you go to a physical location and use Apple Pay, Apple doesn't know what you bought, where you bought it, or how much you paid for it. The transaction is between you, the merchant and your bank.

        """

        I do not see any contradiction of the first paragraph by the second. Apple's quote deals with a "you" as a specific individual. The quote from the Mr. Belt is talking about aggregated data. These two forms of data are different from each other, and Apple's statement is silent regarding whether they are dealing with aggregated data.

        Apple is a publicly traded company. It has a >>fiduciary duty<< to its shareholders to maximize their return on investment. Companies that fail to obey this requirement find themselves facing shareholder lawsuits. No one can convince me that the aggregated data gathered from Apple consumers is without value. If Apple does not realize a return on that value, it risks losing a lawsuit over its fiduciary responsibility. As good capitalists, and responsible managers, they are monetizing this information somehow.

        1. Mike Bell

          Re: This is nothing unusual

          At the risk of labouring a point... If you wave your iphone at a pay point in MacDonalds, and Apple don't know you're in MacDonalds, they don't know you've just bought a Big Mac, and they don't know how much you spent on that Big Mac, what is there for Apple to 'aggregate' and monetise? Pray tell.

          Apple will happily sit back and just let the monthly 'royalty cheques' from the card companies roll in.

          1. nsld

            Re: This is nothing unusual

            Mike, sorry to burst the bubble but if Apple don't know the transaction values then they cannot audit for the 0.15% fee.

            Applepay links back to which card? The one in the iTunes store? Plenty of tracking opportunities there.

            1. Mike Bell

              Re: This is nothing unusual

              @nsld

              Have a read of this. Note the bit that says "Apple will not be handling the tokenization — the credit networks like Visa and MasterCard will be doing so".

              A bit more about the tokens, and how they relate to you and the payment processor (not Apple) is described here.

              The card information that you may (or may not) already have stored in iTunes just provides an easy means of getting your payment credentials registered in the first place.

              1. nsld

                Re: This is nothing unusual

                "Hey Apple, here is your royalty cheque, its for 0.15c, unfortunately no one seems to be using apple pay!"

                And therein lies your first problem, do you really think Apple will just accept a payment with no audit trail?

                There is also a world of difference between not handling the tokenisation and not tracking the activity, the two are not one and the same.

                Given that iPhones track when the charger is plugged in they are already able to track when the NFC is used.

                At the very least there will be aggregate data collection, which can be used to identify people through comparison with other collected data.

            2. Peter 39

              Re: This is nothing unusual

              >sorry to burst the bubble but if Apple don't know the transaction values then they cannot audit for the 0.15% fee.

              I would expect that the existing auditors of the financial institution will take on this task. It'll be spelled out in the agreement somewhere - it always is. Apple certainly isn't going to do any auditing itself.

        2. Anonymous Coward
          Anonymous Coward

          Re: This is nothing unusual

          Part of that fiduciary duty is to not destroy the brand and the company by focusing on short term boondoggles that you're not good at. Well managed companies focus on doing the things they understand and look for stable profits over the long term. There do seem to be a lot of CEOs that don't understand that, however.

        3. Peter 39

          Re: This is nothing unusual

          >Apple is a publicly traded company. It has a >>fiduciary duty<< to its

          >shareholders to maximize their return on investment.

          This is widely believed but is actually untrue.

          Apple certainly does have a fiduciary duty to its shareholders but is NOT required to maximize their return on investment. Tim Cook made that very, very clear at the recent shareholders meeting. He was quite angry about it - the only time he seems to have ever lost his "cool".

    2. Peter 39

      Re: This is nothing unusual

      Actually this can't happen. Apple never gets any transaction detail. It down't know what you bought, or where.

  11. Dan 55 Silver badge
    Happy

    Heh

    A couple of days ago (unfortunately I can't remember where) I read that because Apple didn't get any payment for transactions because they didn't store any data, the only thing they got out of it was people buying their phones due to services such as this because they just made their money selling high-quality hardware.

  12. Slx

    I can't see this launching here in Ireland anytime soon. The banks absolutely gouge on debit card fees which constantly keeps card usage down and ATM usage up.

    Pretty stupid as it costs them significant amounts to stock and manage ATMs and process all the cash.

    Since the banking crash most of them ditched "free" banking and charge up to 20cent per transaction. Usually they'll waive fees if you agree certain requirements like to keep €3500 in your current/checking account which is pretty pointless.

    They then regularly moan about Irish consumers not using card payments and conclude that "for cultural reasons" Irish people prefer to carry cash. Hmmm... Yeah it's because you end up getting hit with about €50 in quarterly fees if you do.

    For example every debit card here has contactless payment but retailers won't generally bother accepting it because the fees are considered too high.

    A few places accept it, but not many.

    Lots of places also will not accept debit or credit cards for less than €10.00 which really annoys tourists used to paying for everything by card. Other small cafes and other places tend to just not have card machines at all because the merchant banking is too costly and they're too small to cut a deal on volume of transactions.

    One newer bank also no longer accepts ANY cash! You literally cannot deposit anything other than electronic funds or cheques.

    Maybe Apple might be able to bypass some of this by cutting Eurozone-wide deals for a processor as soon as the Single European Payment Area stuff starts to fully bed in.

    But, I can't see retailers agreeing another % on already very steep merchant banking and card acceptance fees.

    I think the situation in many European countries is similar, especially where you've historically had only a few players in retail banking.

    We only have AIB, Bank of Ireland, PTSB, RBS/UlsterBank and and a recent new entrant that doesn't accept cash KBC.

    Our small banks all went wallop during the banking crash and got merged or swallowed up and some of the more aggressive international players like Bank of Scotland Ireland over lent into the real estate bubble, burnt billions and then cut their losses left the market entirely closing down retail banking operations entirely and slinking off into the sunset.

    In general though we're being absolutely screwed over by banks that just see debit & credit cards as a way of paying down their boom time gambling losses.

    So I'd say it'll be a while before I see Apple Pay being adapted here.

  13. Tsunamijuan

    Quite low

    I am surprised that their take is so low. But I guess they are thinking start low to entice the small people that aren't taking advantage electronic payments now. 2.5-3% is fairly standard as a small merchant for processing of credit cards and debit cards. With small purchases tacking on 5-10$ surcharges in a lot of places for sub 20$ orders.

    I am sure the plan is to start small then once they have a grip on the market raise it up closer to the average slowly over time.

  14. Michael Thibault
    Joke

    00.15% is probably enough

    for Apple to pay for the bonking gear that they'll foist onto retailers globally after making 'an offer they can't refuse' i.e. 'use our kit or the money gets it'.

  15. Saint Gerbil

    "Apple said it wouldn't access any payment data, so the transaction would take place between a user, bank and retailer."

    There are a couple of things going on in there:

    1. Apple (lawyers) are setting themselves up so they are nor responsible for any fraud.

    2. If its all going on between a bank and its customers then why the 0.15% cut then if apple are nothing to do with it?

    1. Dan 55 Silver badge

      I suppose there will be some flag in the transaction which says 'this was bonked by Apple'.

      As much as they'd like to say they are not responsible for fraud, if there's a high proportion of fraud with iPhones then they are responsible for it. Or at least will have to push out a security update.

  16. Rich 2

    Eh?

    I don't get it. Your acerage credit card company takes a MUCH bigger cut than 0.15% and nobody seems to care too much about that.

    Why the issue?

    1. whatevs...

      Re: Eh?

      Truthfully? Because it's Apple.

  17. djnapkin

    NFC already here in Oz

    I am puzzled by these comments that the banks in UK or wherever need to get into the NFC game.

    Because here in Australia, pay-by-bonk is quite widespread. Most of the retailers that do a lot of transactions via card, already have touch technology readers.

    We just touch the card on to the reader for payments up to $100 and no PIN required.

    These terminals take the traditional swipe, plus the chip-n-pin, and now PayWave as it is called here.

    Is this really not widespread elsewhere?

  18. npsyraishn

    Let's suppose $50 billion is spent using the service, which is realistically the best case scenario, considering that Paypal processes $55 billion a year. That would mean Apple receives a profit of $75 million a year. That's chump change for Apple, almost not even worth talking about.

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