“The brutal fact is that Apple (AAPL) enrolled 15 goliath financial institutions in Apple Pay — and now Apple may have little incentive to add many more institutions to the mobile payments system,” Robert McGarvey writes for TheStreet. “That has experts wondering about the possible impact on the excluded banks.”
“When Apple Pay launched on Oct. 20, it had just six credit card issuers signed up. With that count, the company claimed it opened access to a possible 83% of credit card transactions. There is no official count with a new institutions added in but, sources said, the figure is approaching 90%,” McGarvey writes. “Current Apple Pay entities are American Express (AXP) , Bank of America (BAC) , Barclaycard (BCS) , Capital One (COF) , J.P. Morgan and Chase (JPM) , Citi (C) , M&T Bank (MTB) , BofA’s Merrill Lynch, Navy Federal Credit Union, PNC (PNC) , Regions Bank (RF) , US Bank (USB) , BofA’s US Trust, USAA and Wells Fargo (WFC) .”
“Chris Stulpin, a senior vice president at Pennsylvania-based Capital Markets Group, wrote in a recent research report, ‘Apple Inc. has potentially handed a major competitive advantage to the largest U.S. banks at the expense of their smaller counterparts,'” McGarvey writes. “Others are more guarded. Tommy Marshall, a partner in the banking group at consulting company Capco, said, ‘Being presently left out of Apple Pay is not devastating to financial institutions. It will be a novelty for the next year or two. Most consumers carry multiple payment instruments. I don’t see this hitting community bank payment volume.'”
Read more in the full article here.
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