Android Pay Enables In-App Purchases Engaging in a Tight Race With Apple Pay

Launched in the fall, Android pay has seen considerable adoption. There are now over 1 million locations across the United States that already accept tap and pay, with more being added every day, as stated in the official blog.

Now Google takes Android Pay to the next level - purchases within apps for users around the world.

Starting today, Android Pay users will be able to use the service within a wide range of Android apps in the US.

All it takes to use the service within apps, is to tap the Android Pay button in the app and confirm the information. Security is ensured by not sharing card details with merchants.

In the coming months the range of apps enabled with Android Pay will grow. Google is trying to boost interest and usage by offering special savings in select apps — from $20 off on OpenTable dining, $10 off Lyft ride, $10 off DoorDash to 30% off Vinted. Currently, there is a collection of more than 20 special offers from different merchants.

Market expansion. Tight race with Apple Pay in Australia

Google is also taking steps to bring Android Pay to Android users across the globe. In the first half of 2016, Android Pay will arrive in Australia. The company is working closely with many of Australia’s major financial institutions — including ANZ, Westpac and many other banks — with the aim of bringing Android Pay to their MasterCard and Visa card holders. Australia being an international market to start with, Android Pay will be rolled out in other countries as well throughout 2016.

When Android Pay arrives in Australia next year, it will support MasterCard and Visa credit and debit cards. The company is also working with EFTPOS to support their cards in Android Pay.

Aussies will be able to use Android Pay everywhere contactless payments are accepted. Google named specific retail partners for the launch of Android Pay like 7-Eleven, Brumby’s Bakery, Coles Express, Coles Supermarkets, Crust Gourmet Pizza, Domino’s Pizza Enterprises Limited, Donut King, Gloria Jean’s Coffees, McDonald’s, Michel’s Patisserie, Pizza Capers and Telstra.

Google has also partnered with other payment providers such as eWAY, First Data and Stripe to make accepting Android Pay across stores and apps a breeze.

According to a report by Australian bank Westpac, contactless payments via mobile will reach a value of $3 billion in Australia by 2015. In Australia, mobile-based contactless payments have accounted for 60% of all debit card transactions in the past 12 months. This is obviously a very important reason for companies like Google and Apple to expand their geographic footprint.

Android Pay by Google is Apple Pay`s great rival. A month ago, Apple Pay launched in Australia in partnership with American Express with no other bank support. The service had certain issues in the Australian market, which may be a boon for Android Pay when it rolls out in 2016.

One of the major obstacles for Apple Pay in Australia has been the high fee for transactions. In the US, Apple earns $0.15 for every $100 of transactions. The company was looking for a similar deal in Australia, but the big four Australian banks weren’t willing to provide the same amount of interchange fee to the tech giant. Australian banks get $0.50 for every $100 of transactions, which is half of what US banks get. The big four banks of Australia were reluctant to share that amount with Apple as it would significantly lower their interchange revenue. According to these major Australian banks, the payments market in Australia is quite developed as compared to the US and the UK, and the technology on which Apple Pay works has already been in the market for quite some time. Hence, according to them, the value sought by the tech giant was unreasonable.

Android Pay must have had a very attractive offer for the Aussie banks to be able to secure their extensive network support. LTP will of course be following the roll out in 2016 to track their progress in the market.