Apple Pay continues to develop as support at retailers and inside applications expands. A new research note from Bernstein this week marks that growth and notes that Apple Pay is one of the largest long-term competitive perils to PayPal.
Bernstein researchers estimate that Apple Pay presently accounts for about 5% of global card transactions. At its current progress rate, nevertheless, Apple Pay is on track to lock-in 10% of world card payments as soon as 2025.
Apple’s continued growth within the payment space comes at the cost of PayPal, the analysts say. “Apple Pay is certainly one of many long-term aggressive intimidations to PayPal,” Bernstein said in its research note.
The comparison versus PayPal is one that Apple itself has begun to make recently. In 2019, Tim Cook praised that Apple Pay transaction volume is rising 4x as fast as PayPal, while Apple Pay’s new user growth is also ousting PayPal.
Bernstein analysts further note that theoretically, Apple may end up competing with Visa and MasterCard with its own payments network.
Apple is able to profit from the tight hold it has on the iPhone’s NFC hardware, which is something that has prompted regulators to look into Apple’s behavior closely. For instance, EU antitrust regulators have reportedly reached out to other firms in the payments sector about Apple’s possible anticompetitive conduct.
In a separate report, Juniper Research predicted that contactless payment transactions could attain $6 trillion worldwide by 2024, fueled by Apple Pay.
The research found that Apple Pay will account for a 52% holding of OEM Pay transaction values, up from 43% this year. The expansion of Apple Pay’s user base in key areas, along with Far East & China and Europe, will drive development, as well as the expansion of Apple’s reach outside OEM Pay via its Apple Card initiative.