Only one in five US iPhone 6 users has made a purchase with Apple Pay, and the overall adoption rate has plateaued from early 2015, according to a First Annapolis survey of 1,279 smartphone users conducted in December. Customer experiences to date are, however, positive, and awareness of the offering is quite high. But factors limiting adoption of mobile payments need to be addressed, including the perceived utility relative to existing payment products and services, a lack of mobile application usage by some existing smartphone owners, and the limited merchant acceptance of NFC-based mobile payments.

Despite the latter, the physical Point of Sale remains the primary origination channel for purchases. Among those that have used Apple Pay, 66 per cent report have done so in-store, while 52 per cent have made an in-app purchase. Between April and December, though, there was a notable increase in the number of users who reported using Apple Pay for in-app purchases only, a likely result of limited PoS acceptance, continued incidences of difficulty in completing PoS transactions, and the recent integration with store/loyalty cards from national retail chains such as Walgreens, BJ’s, Kohl’s, and JC Penney.

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