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Apple Pay Now Accepted in 700,000 Locations Because Apple’s Timing Was Impeccable

Apple rode the coattails of the retail industry's movement to upgrade its payment terminals.

Bonnie Cha
Jason Del Rey has been a business journalist for 15 years and has covered Amazon, Walmart, and the e-commerce industry for the last decade. He was a senior correspondent at Vox.

Apple’s mobile payment system Apple Pay is now accepted in 700,000 U.S. locations, including 50,000 Coke vending machines, CEO Tim Cook announced at the company’s product event today in San Francisco. The system allows users to tap their iPhone or Apple Watch against the permanent terminal at select stores to pay without the need to use a credit or debit card or cash.

While the number Cook cited today is impressive, it really is just a reminder of how good Apple’s timing was in launching this system. You see, in order for a store to accept Apple Pay, its payment terminal has to include a technology called near field communication, or NFC. A bunch of retail chains already had the technology, allowing Apple to easily launch with hundreds of thousands of partners.

And a credit card industry push to make cards more secure is actually making things even easier for Apple. Here’s why. Card companies in the U.S. have been issuing new types of cards embedded with computer chips that are replacing the old swipey cards which are more fraud-prone. If retailers don’t upgrade their terminals to accept these new cards by October, they may be liable for any card fraud that happens in their stores.

And here’s why this is good for Apple Pay. Most of the payment terminals needed to accept these new chip cards also include NFC, meaning they are ready to accept Apple Pay basically from the start. This means Apple Pay acceptance is skyrocketing because NFC acceptance is skyrocketing. Google, for example, launched Google Wallet years ago using the same NFC technology, but a small part of why it never took off was because not enough stores accepted it.

This isn’t to dismiss the numbers Apple is citing. Apple Pay is certainly an incentive for some retail operations to upgrade. But, more than anything, these numbers just show how good Apple’s timing was in piggybacking on the upgrade cycle retailers were going through anyway.

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