Apple Pay and Google Wallet are currently fighting to become mainstream.
While most consumers agree that the NFC tap-to-pay technologies are pretty cool, retailers aren’t jumping on board as fast as the tech world has hoped.
A big reason for that is the Merchant Consumer Exchange (MCX). The MCX is a consortium of some of America’s largest retailers.
In 2012, MCX got together and decided that they were going to create something called CurrentC. CurrentC is a mobile payment platform that uses QR codes instead of Near Field Communication (NFC) technology. Unfortunately, CurrentC is unsecure, self-serving, and inferior to Apple Pay and Google Wallet in many ways.
In spite of that, MCX retailers must support CurrentC. Earlier today, the New York Times posted a report showing that MCX-affiliated retailers face steep fines if they accept Apple Pay.
Here’s what the NY Times says:
“The problem is that under the terms of their MCX contractual agreement, they are not supposed to accept competing mobile payments products like Apple Pay…If these retailers break their contracts, they will face steep fines for doing so.”
The NY Times cites “multiple retailers involved with the MCX, who spoke on the condition of anonymity.” The terms of the contract between MCX and retailers has not been disclosed.
Retailers unsure what to do
When Apple Pay was first announced, Rite Aid and CVS initially supported the new payment system. Last week, they quietly pulled their support. The retailers either just found out about the steep fines, or they were pressured by the MCX to abandon their Apple Pay support.
On the one side, these retailers are facing a huge consumer backlash and potential boycott against CurrentC. On the other side, they’re bound to a contract.
Does Apple Pay have a chance?
Back when the MCX was first formed, Apple Pay and Google Wallet weren’t around. Retailers didn’t plan for competing mobile payment platforms.
If Apple Pay and Google Wallet are to succeed and become mainstream, then two things need to happen:
-The majority of consumers need to boycott CurrentC or MCX retailers
-The majority of consumers need to have NFC-enabled smartphones capable of running Apple Pay or Google Wallet
The good news is that Apple has billions of dollars to play with. And tech fans are getting angry.