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Apple Pay heads across the Pond

Matt Hamblen | June 9, 2015
The mobile payment service will reach 1 million locations in the U.S. by July, Apple said.

iphone6 3 up ios9 wallet print
Credit: Apple

Apple Pay will launch in the U.K. in July, where it will initially work at 250,000 retail locations and the London transit system -- with credit card support from eight major banks, Apple announced Monday.

Some observers had expected Apple Pay to launch in Canada as well, but company executives didn't discuss plans for Canada during the keynote address at Apple's World Wide Developers Conference (WWDC).

Apple Pay first launched in the U.S. last October with more than 225,000 retailers and has steadily expanded. The mobile payment service will reach 1 million locations in the U.S. by July, said Jennifer Bailey, Apple's vice president of Internet services.

She said 2,500 banks now support Apple Pay in the U.S. adding that Discover cards will be supported sometime in the fall.

While 1 million locations is considered impressive, the expansion to 90% of all 12 million retail locations in the U.S. could take five to 10 years, according to banking and credit card experts. Banks are already pushing retailers to upgrade their in-store payment terminals to support smart credit cards by October, and nearly all those new terminals also support NFC payments, like Apple Pay uses. But the rollout will still take years.

As expected, Bailey announced that Apple Pay will automatically process loyalty and rewards cards. In other words, customers automatically get coupons, rewards, loyalty points and special offers from a specific retailer -- or from Apple itself -- applied when a purchase is made from an NFC-ready iPhone or Apple Watch.

But Apple Pay will also support some store credit cards beyond just major credit cards Visa and MasterCard. Bailey named JC Penney, Kohl's, Fandango and BJ's store credit cards as those that will be supported initially.

"Apple Pay automatically presents the right card" during the payment process, she noted. The improvements she described will work with the coming update called iOS9 for iPad and iPhone, as well as Apple Watch. The update is expected in the fall.

Bailey also said that Apple Pay will allow users to buy items from hundreds of stores within the Pinterest app. She also said the Passbook app will be renamed Wallet, and will be the single place to store credit and debit cards, rewards cards, boarding passes, tickets and more.

Of interest to small businesses, Bailey said Square plans to launch a new payment reader device to accept Apple Pay. The WWDC presentation showed the coming reader device as a flat square that doesn't plug into the phone as the current Square device does. Square will apparently incorporate NFC in the coming device to support the tokenization Apple Pay provides for better security.


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