Apple To Brand iPhone As Digital Wallet

Worldwide, only about one in five consumers currently use their smartphones as a “wallet,” according to a new report from Loup Ventures.

Yet, Gene Munster’s VC firm believes that four in five people will eventually use their phones to make real-world purchases.

Despite competition from Google, Samsung, PayPal, Venmo, Square, Stripe and other wallet providers, Munster expects Apple to benefit greatly from this growth trend.

“Apple has several advantages to brand the iPhone as the premium digital wallet,” the research analyst turned venture capitalist writes in the new report. 

Among other assets, Apple is in a unique position to integrate payments into both mobile and desktop operating systems, as well as win over retailers, banks and security-sensitive consumers.

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“Apple Pay is the only digital wallet with all five payment pillars: mobile, desktop, in-app, peer to peer and point of sale,” Munster notes. Over the past year, 31% of iPhone owners have used Apple Pay -- up from 25% a year earlier.

Still, Apple Pay currently represents no more than 2% of Apple’s Services business, by Munster’s estimation.

During its fiscal third quarter, Apple’s services business -- which also includes the App Store, iTunes, Apple Care and its cloud services -- generated $9.55 billion in revenue. That means Apple Pay put an estimated $200 million into Apple’s coffers during the period.

Munster estimates Apple Pay now has 252 million+ users, which equates to 31% of the iPhone’s active user base. Going forward, he expects Apple to increasingly market the iPhone as an alternative to wallets and purses.

Relative to 15% growth in the United States, Apple Pay adoption is accelerating exponentially, overseas (85%).

1 comment about "Apple To Brand iPhone As Digital Wallet".
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  1. James Pasquale from digi.me, August 11, 2018 at 4:46 p.m.

    Gavin:  The term wallet will certainly grow beyond simple payment and banking transactions, future wallets will need to carry consent receipts,  blockchain journal entries for identity and key management for starters. Including Cryptocurrency histories with accounts/aliases, and Fiat money services, personal data exchanges and more. Bringing a whole new meaning to Where's your Wallet and What's in It. Payment is the likely the good start, with time telling us who'll lead.

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