Apple turning into a fintech company?

Apple announced several new features for the iPhone Wallet app at WWDC 2022, competing directly with products from fintech companies like Affirm and PayPal. Notably, there is a buy-in, pay-later service, Apple Pay Later. This information caused Affirm stock to drop more than 5% on June 6 and drop another 4% on the morning session of June 7.

Apple turning into a fintech company?  - Photo 1.

Apple is also launching a new payment system later this month that allows paying by touching iPhones together. This is Block’s feature against Square. Wallet on iOS 16 also tracks online orders purchased via Apple Pay.

All of this points to one of the most interesting dark spots in the Apple ecosystem: the ever-expanding set of financial products in Wallet. Many features have not yet brought in direct revenue for “missing apples”, but they do make Apple Pay more attractive to people who have never tried it. Apple charges a commission on every Apple Pay transaction, so the more people use it, the more it benefits. Like most new iOS features, it helps keep customers in the Apple ecosystem and upgrade to a new iPhone when it’s ready.

However, the new feature of Wallet also appeared in the context of global economic uncertainty. Inflation is rising sharply. Gasoline prices continue to hit records. Many are worried about the coming recession. This can be a difficult time for Apple when it comes to launching a product with the goal of encouraging people to shop more. The company’s competitors in the field of pre-pay, post-pay have struggled in recent months due to changing spending habits of customers. Other crypto and fintech companies such as Robinhood, PayPal, and Coinbase have not escaped this scene.

Apple has a long-term vision with Wallet. When introducing the latest features on June 6, the leaders said that the ultimate goal is that the Wallet application can replace everything in the user’s wallet. However, some features are being rolled out slowly, such as the ability to add driver’s licenses, which is only available in some states in the US. Even so, they can only be used at TSA checkpoints at an airport in Phoenix. Car manufacturers are “soft” when applying the feature to save the version of the digital key on the iPhone.

However, Apple is not too worried about speed. The company hopes that consumer demand will make third-party applications faster. In terms of fintech, Apple is building a platform to promote the payment segment when adding more functions to Apple Pay, Wallet to use iPhone to pay for everything, instead of using a credit card. With more than 1 billion active Apple devices, many people will be exposed to these services.

According to Du Lam

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