Enabling Technologies

Best Buy Gets on the Apple Pay Bandwagon

MEDICIFounder and Chief Strategy & Innovation Officer

Best Buy customers, using an iPhone 6 or iPhone 6 Plus, can now use Apple Pay to make purchases in the Best Buy app. An updated Best Buy app is now available in the Apple App Store. But the latest update of even more significance is that all U.S. Best Buy stores will also start accepting Apple Pay later this year. Best Buy wants to wants to give its customers as many options as possible in how they pay for goods and services in-store.

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Best Buy, which is a member of the retailer consortium MCX and a rival of Walmart, is indeed a big catch for Apple Pay. Earlier we discussed the rivalry between Apple Pay and CurrentC, the mobile payment system backed by MCX. As a result of CurrentC’s exclusivity, retail members such as Best Buy had limited options in adopting mobile payment systems. As reported by Re/code, it has come to light that Best Buy is looking to adopt Apple Pay later this year as its MCX membership is expiring over the summer. Best Buy might in fact exit the consortium for mobile payments by not renewing its membership.

New revelations highlight that MCX will eventually support other payment technologies besides QR codes, such as NFC & Bluetooth Low Energy. It has come to light that MCX might be in talks with credit card companies to broaden the scope of the CurrentC mobile wallet service. Bringing Apple Pay into the picture, current MCX members who wish to accept Apple Pay exclusively won’t be fined but will have to leave MCX eventually. However, Meijer, an MCX member that is adamant on using Apple Pay, has yet to be barred from the membership of the consortium.

Rite-Aid and CVS, also members of MCX, had shut down the NFC capabilities in their POS terminals in order to support CurrentC. The current situation shows that this might not have been a well advised choice. CurrentC hasn’t been launched yet and it may have already missed its chance to impact the competition. Competitors like Apple Pay are increasing their transaction numbers day by day. MCX’s major backer in mobile payments (Paydiant) is itself now part of PayPal, who might not want Paydiant to run a competing mobile payment system (CurrentC).

Given the market reality, MCX might soon face the heat from its own members. Best Buy already has a big influence in the retail market and its approach could also affect the decisions of other retailers. One day MCX might open itself to all forms of mobile payment systems. The fate of CurrentC remains to be seen.

Considering Best Buy itself, the acceptance of Apple Pay in the Best Buy app is the latest enhancement to their mobile platform. Best Buy is also setting up a technology innovation office in Seattle this summer whose primary focuses will include mobile and the company will continue to implement new tools to the enhance customer experience in this important growth area. The technology development center in Seattle is aimed at fuelling Best Buy's rapidly expanding e-commerce and mobile development capabilities.

Meanwhile, Apple Pay has also gained the payment card network Discover as its latest supporter.

Amit Goel

MEDICIFounder and Chief Strategy & Innovation Officer

“Amit Goel is the Founder & Chief Strategy & Innovation Officer for MEDICI. Amit’s vision is to build a strong FinTech market network that involves financial institutions, banks, startups, investors, analysts & other key stakeholders across the ecosystem – helping each one of them in a meaningful way by removing the asymmetry of information and providing a platform to engage & transact.\ \ Amit is passionate about bringing actionable FinTech-focused insights, innovative products & services for the FinTech ecosystem. Some of his work involves startup scores, bank scores/assessments, predictive viewpoints & other innovations that have helped MEDICI’s customers and the ecosystem. He has been named amongst the Top 100 FinTech thought leaders/influencers in the world & Top 10 in Asia multiple times by reputed agencies, consulting firms as well as financial institutions. Amit has built MEDICI (formerly LTP) as a new-age, tech-enabled advisory/research firm, which is now considered the #1 global research & innovation platform for FinTech in the world.\ \ Amit has been writing pioneering viewpoints on financial technology space that have been ahead of the curve since 2010. His data-driven predictions have helped the customers as well as the ecosystem. His past work experience includes a strong background in strategy & market analysis and advisory to clients (from big business houses to Fortune 500 firms) in payments, commerce, financial services & IT/technology. In the past, Amit had also founded a successful consulting & research practice called GrowthPraxis and has worked at Boston Analytics, Frost & Sullivan, and Daimler Chrysler in strategy & research.”