Apple Pay is struggling to gain traction outside of the US market, according to research specialist Timetric. The service launched in the US 18 months ago and has proved relatively strong there with most of its total usage of $10.9bn last year coming from Apple’s domestic market.
However, it’s facing resistance from both banks and consumers as well as battling some technical challenges elsewhere, Reuters reported, citing the Timetric research. While the service is reported to be popular among Apple diehards in markets like the UK, China and Australia, it’s failing to win large numbers of new users outside of that core group.
Apple Pay is currently available in six countries and the number of banks offering the service is limited, although it has grown in recent weeks with some new banks of signing-up in Singapore, Australia, New Zealand and Canada.
The $10.9bn total transaction figure is seen as relatively small, especially given the potential size of the mobile payments market. In key market China, around $1trn in mobile payments was processed last year, much of it by Alibaba and Tencent, according to iResearch data.
Part of the problem has been technical issues. In Australia, where Apple Pay only launched last month, there have been a number of technical failures. “Bendigo Bank is experiencing some unforeseen technical issues in accepting Apple Pay payments at selected merchant terminals,” a Bendigo spokeswoman old Reuters.
But Apple said that Bendigo’s experience isn’t representative and that new technology cam take time to win over a wide customer base. The company is continuing its push to make Apple Pay a success internationally.
Analysts told Reuters that Apple’s relatively slow country-by-country rollout of the service is a problem for it and sees it coming up against fast-developing mobile payments businesses from domestic banks in markets like the UK, Australia and Canada.
Juniper Research said $14bn was spent via contactless cards in the UK last year with consumers comfortable with using contactless cards. They’re therefore unwilling to make the extra effort to register their cards for Apple Pay so that can use their phone or Apple Watch instead.
A similar situation has been seen in Australia with Reuters quoting an unnamed retailer saying uptake had been slow.