WWDC 2017: Apple Pay Is Out To Replace PayPal's Venmo With P2P Payments Via iMessage
During its WWDC 2017 keynote address, Apple just announced that Apple Pay is gaining a peer-to-peer payments system. That feature will arrive once iOS 11 rolls out later this year. Soon, you and your friends will be able to send and receive payments within Apple Pay.
Apple Pay Gets P2P Payments Inside iMessage
The move is undoubtedly an attempt to undermine the popularity of apps such as Venmo and Square Cash, all of which allow P2P transactions. In the case of Apple, P2P payments will be done through iMessage, although it isn't clear if Apple will allow transactions outside the messaging app. The money will be transferred to what's called an "Apple Pay Cash Card," which can then be transferred to a user's bank account.
Transactions will be performed via Touch ID to make sure transfers are secure. Apple hasn't confirmed if its P2P payments system will charge either the sender or receiver for transactions.
Sending or receiving will be easy. Machine learning will detect mention of payments inside iMessages threads, at which point an Apple Pay button will show up on the keyboard.
Apple's New P2P Payments Feature Poses A Threat To Other Apps
Venmo was the first app to popularize P2P payments, which PayPal then absorbed when it acquired the company in 2013. Apple, on the other hand, has been slow to enable the feature on its Apple Pay service, despite the 375 million users who have access to the app. Of course, that'll soon change once iOS 11 rolls around.
Although late in the P2P payments game, Apple's new feature will likely be a threat to PayPal, Square Cash, and other similar services. This is because Apple Pay is huge and widespread: Apple's senior VP for software engineering said that Apple Pay will be available on half of all U.S. retailers by the end of the year.
Venmo, however, is still pretty successful. It's been seeing massive success with its growing service. In fact, in the first quarter of 2017, Venmo processed $6.8 billion worth of transactions, which is twice the amount recorded in the same period last year.
Launched in 2014, Apple Pay is a way for iPhone owners to load their credit and debit card information onto their devices and get a "mobile wallet" for easier and more seamless payments at retail stores.
Available on the iPhone, Apple Watch, and MacBook, owners can use Apple Pay to either shop online or pay at point-of-sale registers equipped with NFC technology. Users place their device near the POS sensors to register a payment, all without swiping a single card. Similarly, users may also buy in-app purchases using Apple Pay. It's a frictionless method of payments between smartphones and registers, and Apple wants it to become widespread.
Forrester Research estimates the total P2P payments market will reach $17 billion in transaction volume in the next two years.
Thoughts about Apple Pay venturing into the P2P payments arena? How do you think could this affect PayPal, Square Cash, and others? As always, feel free to sound off in the comments section below!