Some US retailers shun Apple Pay, eye rival payments system

28 Oct 2014 | Author: | No comments yet »

Battle for Your (Mobile) Wallet: CVS and Rite Aid Stop Taking Apple Pay.

CHICAGO (Reuters) – Some large U.S. retailers are refusing to use Apple Inc’s APPL.O new electronic payments service as they commit to developing a rival payments system that would bolster their profits by eliminating credit card transaction fees. “Given that we are still in the process of evaluating our mobile payment options, Rite Aid does not currently accept ApplePay,” a company spokeswoman said in a statement to PCMag. “We are continually evaluating various forms of mobile payment technologies, and are committed to offering convenient, reliable and secure payment methods that meet the needs of our customers.” CVS echoed that sentiment, saying in an emailed statement that “At this time, CVS/pharmacy cannot accept Apple Pay or other mobile payments that use NFC technology. Fees range between 2 percent and 3 percent of costs per transaction. “”The economics and benefits of having your own payment system is definitely one of the main reasons,” said Hitesh Sheth, chief executive of retail technology cybersecurity firm Vectra Networks. The NYT reported that MCX’s service, dubbed CurrentC, will help merchants keep track of customer shopping habits, and could cut credit card companies out of the payment process entirely.

Mastercard criticized the move by CVS and Rite Aid, saying it would limit the options of consumers. “We are disappointed that both Rite Aid and CVS have decided to block their customers from using the payment method of their choice,” Mastercard spokesman Jim Issokson said. Apple Pay, unveiled just last month, is a mobile payment app that allows consumers to buy things by simply holding their iPhone6 and 6 Plus devices up to readers installed by store merchants.

CVS did not respond to queries seeking comment but a visit to two CVS stores showed the NFC (Near Field Communications) reader on which Apple Pay was used has been deactivated. But they could run into antitrust trouble if they coordinated on dropping Apple Pay and Google Wallet or if someone else, perhaps a person working with CurrentC, organized their decision to drop Apple and Google’s payment services.

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