What if Apple Pay went cha-ching and nobody heard it?

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A billion transactions, 250 million users, 85% over there.


From a note to subscribers posted Thursday by Loup Ventures’ Gene Munster:

Over the last three June quarters, Apple has reported y/y growth of 500%, 400%, and 300%, respectively, bringing the total transaction number “well over 1 billion” (Source: Apple). With the continued expansion into new markets and new partnerships with banks, we expect transaction growth of 200% over the next 12 months.

On Apple’s latest earnings call they shared data points that allow us to back into updated user metrics.

  • Over 1 billion cumulative transactions in Jun-18, a 3x increase in transactions y/y (source: Apple).
  • Apple Pay now has over 4,900 bank partners (source: Apple).
  • We estimate that Apple Pay now has over 252 million users, which equates to 31% of the active iPhone base (source: Loup Ventures).
  • Adoption of Apple Pay continues to accelerate exponentially overseas compared to the U.S., with 85% of users being international vs. 15% in the US (source: Loup Ventures).

Apple has several advantages to brand the iPhone as the premium digital wallet given its ability to integrate payments into both mobile and desktop operating systems, use its brand to win accepting retailers and supporting banks, and reassure users that transactions are secure and private. Separately, Apple Pay is the only digital wallet with all five payment pillars: mobile, desktop, in-app, peer to peer, and point of sale.

My take: Why am I still the only shopper I know in an American city of 17,000 who buys his groceries with Apple Pay? Why, five years later, do the cashiers still treat me as a novelty? According to Munster, that’s because nearly all the other Apple Pay users are overseas.