Following Canadian Expansion, Critics Point to Drawbacks of Apple Pay

VANCOUVER, BRITISH COLUMBIA--(Marketwired - June 7, 2016) - Earlier this month, Apple Pay increased their presence in Canada by signing on two major Canadian banks (RBC and CIBC), along with two additional financial institutions (ATB Financial and Canadian Tire Financial Services). The new partnerships follow Apple Pay's official launch into Canada last year, through collaboration with American Express.

The expansion now allows consumers to upload credit card information to their smartphones to use at retailers and restaurants, but critics suggest the tool may prove less useful than the hype around it suggests.

Since launching in the United States in 2014, only 6% of users with Apple Pay-enabled iPhones were reported to use the service, indicating relatively low adoption rates. While Canada's early implementation of EMV payments in 2010 suggests a favourable environment for Apple Pay, the system's inherent shortcomings remain the same.

Rod Hsu, President of nTrust, a Canadian FinTech company, points out several drawbacks that may prevent the payment tool from gaining mass traction:

• Maximum limit: Similar to paying via credit card through tap, Apple Pay has a transaction limit of $100. This makes the tool an appropriate method for small purchases, but unusable for larger transactions such as a sizable grocery shop, high-end meal, or most electronic or clothing purchases. With the average credit card transaction just over $100 in Canada, users will still be required to carry their card.
  
  
• Merchant adoption: While a comparably larger number of recognizable shops and services -- including McDonald's, London Drugs, Tim Hortons, Canadian Tire, Petro-Canada, and Pizza Hut -- are equipped to accept Apple Pay in Canada, many local favourites don't yet have a tap-enabled point of sales system. This may irritate users, who will be forced to carry their credit and debit card as a back up.
  
  
• Overspending: Similar to other tap-and-pay options, the ease of paying via mobile makes overspending likely. The step away from tangible cash transactions often leads to a rise in spending, as micro-transactions add up over time. Canadian households already reached a new record average debt at the end of 2015. Considering consumers are more likely to reach for their phones than their wallets, this becomes a particular concern.
  
  

According to Hsu, Apple Pay has the potential to encourage wider adoption of tap-and-pay technology by both merchants and consumers. However, improving overall usability is necessary for Apple Pay to truly excel in Canada.

About nTrust

nTrust is a rapidly growing online and mobile money transfer platform that helps people around the world instantly move and access their money. Using nTrust, members can send money to friends, cash out to their bank account, spend money through their phone, or load funds to a prepaid card to use anywhere the MasterCard® Acceptance Mark is displayed, online or in-person. nTrust's proprietary technology uses the highest encryption standards and is "PCI-DSS Level 1" certified, which remains the top global standard for operational and technical security designed by Visa, MasterCard®, and American Express.