Apple Reportedly Developing Person-to-Person Payment Service To Challenge Venmo

Venmo and PayPal may soon have some serious competition, as Apple, Inc. is reportedly developing its own person-to-person payment service. Rumor has it that Apple recently held meetings with other payment industry companies.

The service would allow iPhone users to digitally send money to one another, and it is also rumored that Apple would partner with Visa in order to provide digital prepaid cards. These cards would utilize Visa’s network and be directly linked to Apple’s service. Users would be able to send “Apple Cash” to one another and use the Visa card and Apple Pay to spend the money online or at retail stores without waiting for it to be cleared by a bank.

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Apple was supposedly in talks with a number of banks about a similar service in 2015. These negotiations, however, fell through. Apple hopes that a person-to-person payment service would boost the use of Apple Pay, which has not gained as much popularity as Apple had initially anticipated.

Apple Pay works at supported retailers that accepts contactless payments in fifteen countries, including the United States and China. However, few iPhone users have fully adopted the service. Last year, 20% of American iPhone users reported using the service at least once. Most of those surveyed used the service sparingly.

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Person-to-person payment services, however, have become incredibly popular, especially amongst millennials. Venmo’s profits have increased 100% each financial quarter since 2015. The company reportedly registered $17.6 billion this past quarter. PayPal registered $228 billion in 30 currencies across more than 190 countries in 2014. These services have become increasingly popular as people carry around cash less.

Sources currently disagree over whether Apple will officially announce its new service in 2017. Some argue that Apple plans to release an app by the end of the year, while others insist that Apple is nowhere near release. Regardless of the debate, it appears that Apple serious about launching a Venmo competitor sometime in the next few years.

Via:  Recode
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