Apple Pay could represent 10% of all card transactions by 2025

Apple Pay continues to grow as support from retailers and internal applications expand. A new research note by Bernstein highlights this growth, and finds that Apple Pay is one of the major competitive threats to the long-term to PayPal.

As detailed by Quartz, the researchers of the Bernstein estimate that Apple Pay is currently about 5% of the overall transactions of cards. Thanks to its current rate of growth, Apple Pay is well on the way to represent 10% of global payment card by 2025.

If the growth trend continues, it could become a competitive threat in the long term to PayPal. “Apple Pay is in fact one of the competitive threats to long-term to PayPal,“ said Bernstein in his research note.

Apple Pay

The Apple began, very little time ago, to make a comparison with PayPal. Last year, Tim Cook said that the volume of transactions Apple Pay is growing 4 times faster than PayPal, while the growth of new users of Apple Pay is going through PayPal.

The analysts of Bernstein have also to be noted that theoretically, Apple could end up competing with Visa and MasterCard with its network of payments, even if this probably will not happen before many years.

The advantage of Apple compared to other digital payments includes its app Wallet pre-installed for the iPhone and its tight control over the NFC technology contained in the device can process payments without contact.

However, this tight control may cause problems with the colossus of Cupertino if it is seen as a way to block the competition. Apple claims that its policies are strictly for security purposes, but has already encountered difficulties in Australia, where the big banks want to access the NFC feature of the iPhone.

The company has also faced a backlash in Germany, where a parliamentary commission has recently approved an amendment to a law on money laundering that could force Apple to open up the NFC chip in the iPhone to providers of mobile payments competitors.

In November 2019, the european commissioner to competition, Margrethe Vestager, has acknowledged that his department has received “a lot of concern about Apple Pay and the potential problems in anti-competitive.