The battle for mobile wallet supremacy looks to be intensifying, as new reports suggest US retailer consortium the Merchant Customer Exchange (MCX) will fine members for accepting Apple Pay.
This is due to MCX planning to launch its own system, CurrentC. Two consortium members, Rite Aid and CVS, disabled Apple Pay from working in their stores over the weekend, just a week after its launch. And according to anonymous sources speaking to The New York Times, any other company in the coalition that breaks a contractual agreement not to accept the service will face steep fines.
MCX hopes the CurrentC smartphone app will help members (including large retail chains such as Gap, Best Buy and Walmart) avoid credit-card transaction fees and track consumers’ shopping habits – data that has traditionally been held by the credit-card companies. However, the system won’t be launched until next year and should Apple Pay catch on, MCX may find it has alienated customers.
“These retailers are in a real jam,” Karen Webster, chief executive of consulting firm Market Platform Dynamics, told The New York Times. “The last thing merchants want is ticking off their consumers over payment.”
Apple Pay enables iPhone 6 and iPhone 6 Plus owners to use contactless payment technology to make purchases by placing his or her phone up to a card reader. While it has yet to be rolled out in Ireland, Apple Pay has been instrumental in enabling 1m cards for near field communication (NFC) mobile phone commerce in the US within its first 72 hours, according to Apple CEO Tim Cook.
Rather than utilising contactless payment technology, CurrentC will instead rely on QR codes, a machine-readable optical label that merchants scan to complete the transaction. Unlike Apply Pay, it will require a downloadable app to work.
Apple Pay image via Shutterstock