Built.io Blog

It’s all about payments

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n case you hadn’t heard, Twitter and Apple both announced new mobile payment solutions this week. They both look pretty awesome and are fairly complementary to one-another.

Twitter ‘Buy’

Twitter’s solution enables merchants to advertise their products and sell them directly from Twitter’s mobile apps. They enable consumers to buy what they want and avoid the frustrating process of creating a new account, adding their billing/shipping details and possibly even downloading the mobile app before they can make their purchase. Twitter retains all of a user’s information and enables their purchase in a few taps.

Apple Pay

Apple offers the same “easy” purchase process but is revolutionary for consumers. Are you trying to sell something in an app or a brick-and-mortar store? Tap into the 800+ million credit cards that Apple has on file. No need to integrate card.io into your app to help “simplify” payment setup for consumers.

The real selling point is for consumers…

PaymentProcessingLandscape2.jpg

Apple Pay is Facebook login for payments, but even better. Facebook was the first platform to truly simplify the onboarding process for new apps. App uptake would never have skyrocketed without a quick way to enable users to start using an app: setup their profiles, connect them with friends, and more. With Apple Pay, adding my payment details is even easier, I just use my thumb.

Unlike Facebook Connect, Apple Pay ensures security and privacy. First, iPhone users add their credit cards to Passbook. This information is encrypted by TouchID, and encrypted and stored as a unique Device Account Number in Secure Element, a dedicated chip in iPhone, so it can never be used by another device. Every time the user purchases something, Apple will share a transaction-specific dynamic security code alongside the Device Account Number to process the payment. Unlike when you hand over your credit card, merchants will never know your name or credit card information, so there’s no fear of getting your credit card number stolen or hacked every time you buy something.

Apple’s unique position in building software to sell hardware enables a consumer-friendly privacy policy. As Eddy Cue said on stage Tuesday, Apple is “not in the business of collecting your personal data.” This is in stark opposition to Facebook, Twitter, and most other companies revolutionizing payments who track your activities and monetize them through their ad products. Apple is leading the pack because it doesn’t save your transaction information and it lets users make anonymous purchases.

The upside for developers

Developers who build apps can integrate Apple Pay in a similar way to Paypal alongside their existing payment processors. Unlike most new payment processing solutions, Apple Pay is designed to integrate alongside existing processors so merchants can continue to use their existing reward programs, payment terminals, etc. With expected sales of over $80 million through Apple Pay compatible iPhones in the next year and more there-after, along with the generally higher-income levels of high-end iPhone users, Apple Pay integration is primed to skyrocket. Just like Facebook Connect became the de facto for sign ups, and the iPhone and iPad have revolutionized their product sector, I expect Apple Pay to make a huge impact on payment processing.

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