Grow Financial leverages Apple Pay to lure younger customers on mobile
Grow Financial Federal Credit Union has integrated with Apple Pay, as it reaches out to a growing number of consumers banking on mobile, especially younger customers, with enhanced payment information protection services.
Integrating with Apple’s mobile wallet means that when consumers add a payment card, the actual credit and debit card numbers will not be stored on the device, nor on Apple servers, and cashiers will not see names, credit card numbers or card security codes. The credit union’s announcement shows how the momentum behind Apple Pay continues to build, with about 750 banks and credit unions having already signed on and the service now being integrated into 200,000 vending machines, laundry machines and parking meters.
“More of our members are using mobile technology than ever before,” said Bob Fisher, CEO of Grow Financial, Tampa Bay, FL. “We are here to serve their needs and provide the tools they want to use in their personal financial lives.”
Grow Financial, with $2 billion in assets, said Apple Pay will transform mobile payments with an easy, secure and private way to pay.
In participating stores, Apple Pay will work with iPhone 6, iPhone 6 Plus and Apple Watch, upon availability. Within apps, Apple Pay is compatible with iPhone 6 and iPhone 6 Plus.With 27 stores,
Mobile banking’s popularity is growing.
During a conference call with analysts in January to discuss Apple’s fiscal first-quarter results, CEO Tim Cook reported that Apple Pay makes up more than $2 out of $3 spent on purchases made using contactless payments across the three major card networks.
Apple introduced Apple Pay in the fall of 2014. The solution in based on near-field communications technology, enabling users pay for purchases in stores and online from their phones.
By the end of 2014, Apple had signed up a dozen more banks, retail stores and start-ups for Apple Pay.
Through its partnerships with financial institutions, Apple claims that Apple Pay now supports credit cards representing approximately 90 percent of credit card purchases in the United States.
For Apple Pay to catch on it is critical that more and more issuers adopt the service. Banks frequently operate as a herd once a new service or technology has been vetted, deployed, and adopted by leading banks.
As the larger banks adopt and market their support for Apple Pay, midsize and smaller banks will feel forced to join in or be left behind as the critical mass of transactions from the top issuers fuel the market for mobility.
Apple Pay still faces some challenges going forward.
For example, a number of retailers still have not upgraded to point-of-sale terminals that will accept mobile payments. However, with an October deadline in place to meet EMV standards, many retailers are expected to use the opportunity to add mobile payments.
Another challenge is the need for retailers to do a better job informing customers that Apple Pay is available as an option.
Penetrating the youth market.
Initial results with Apple Pay are promising, with a number of retailers reporting that they have seen NFC payments increase since introducing Apple Pay.
“Providing Apple Pay keeps us on the leading edge of technology adaptation,” Mr. Fisher said. “Which is important as we continue to penetrate the youth markets.”
Michael Barris is staff reporter on Mobile Commerce Daily, New York