One Reason Zelle is Growing and Apple Pay is Not

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25 January 2018
Bob Meara

I’m periodically humored that after all the hype surrounding mobile wallets about three years ago, consumer adoption has failed to materialize to any meaningful extent. Maybe my delight over this truth is simply a symptom of a sinful, inward desire in my heart to be able to say “I told you so”. On the other hand, there may actually be a useful point to be made.

First, I’ll clear the air by confessing I’m not as digitally-driven as some of you reading this. For example, we just invested in a new garage door and opener. That alone was a stretch based on my familial understanding of parsimony. When it came time to make the opener selection, the salesman strongly advocated a WiFi connected model. “Why would I want a WiFi connected model?” I asked (particularly since it costs more). “So you could operate the garage door remotely using [yet another] iPhone app”, responded the kind salesperson. Undeterred in my abstinence, I asked anew: “Why would I want to do that when I have opener actuators on my car?”. “What if you’re out taking a walk or a run?” he suggested. “That’s what the keypad is for on the side of the garage I’m going to ask you to replace while you’re here.” was my reply.I finally purchased both the keypad and the WiFi enabled model, but mostly out of intellectual curiosity. Since installing it, I have found some useful applications. Ping me if you’re interested. It’s at least as useful as having an internet browser installed next to your ice maker.

Apple Pay

Jennifer Bailey, VP of Internet Services at Apple Pay presented some key facts at Money 20/20 recently:

  • Available in 20 markets around the world, accounting for 70% of the world’s card payment volume
  • Works with 4,000 card issuers
  • 50% of US retailers accept Apple Pay

Apple is undeniably “off to the races” in terms of garnering requisite support by card issuers and retailers. With consumers’ fever to upgrade to the latest phones, most in-service iPhones now have the requisite NFC capability. With those prerequisites firmly in-place, consumer utilization must be through the roof, right?

Well, not exactly. According to quarterly consumer ChangeWave surveys from 451 Research, digital wallet propensity (percent somewhat or very likely to use) has been essentially flat at roughly 25% of smartphone users over the past three years. The less precise Consumers and Mobile Financial Services research commissioned by the Federal Reserve suggests similarly low utilization growth. With mobile payments defined quite broadly as “purchases, bill payments, charitable donations, payments to another person, or any other payments made using a mobile phone. This includes using your phone to pay for something in a store as well as payments made through an app, a mobile web browser or a text message”, surveyed consumer adoption has modestly grown from 12% of mobile phone owners in 2011 to 24% in 2015 – well behind the utilization of mobile banking.

The issue with lacklustre digital wallet interest in the US, is threefold, the same factors that keep 40% or so banked smartphone owners away from mobile banking. Namely:

  1. Disinterest – needs are met using other mechanisms (sorry, not everyone wants a WiFi connected garage door opener)

  2. Security concerns – a perception that cards are more secure

  3. Simple preference for other mechanisms – believe it or not, some humans actually prefer using a card.

So, what about Zelle, introduced in the fall of 2016?


  • Good article Bob! I agree that Apple is missing the boat by not marketing Apple Pay to consumers. I can't tell you how many retail clerks don't even know that their store offers it and are surprised when I can pay by tapping my phone or watch. That is an awareness problem! Love the Zelle ads, hadn't seen those in Canada.

    Victoria Lant
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North America