Countering conventional wisdom that Apple’s and Google’s mobile wallets are increasing in popularity, fraud and risk management firm Kount claims that significantly fewer merchants are accepting Apple Pay and Google Pay this year, with each supposedly falling by 13 percent from 2017 to 2018. These are the headline findings of Kount’s sixth annual Mobile Payments & Fraud Survey, which polled 600 merchants across 29 vertical industries from January to March 2018.
According to Kount, Apple Pay has fallen from 48 to 35 percent acceptance over the past year — “the most drastic decline of all mobile wallets” — while Google Pay has dropped from 38 to 25 percent. The supposed losses offset reported 16 percent and 7 percent gains in merchant acceptance by PayPal and AmEx, respectively, while rivals such as Samsung Pay, Visa Checkout, Masterpass, and Chase Pay are said to have remained constant from 2017 to 2018.
Though the report leads with those surprising figures, it largely focuses on merchant practices for handling mobile fraud — and apparent indifference by 35 percent of merchants to tracking upticks or downticks in fraud. Kount suggests that retailer confidence in payment security is up, with only half of surveyed merchants believing that they need special tools for managing mobile fraud, down from two-thirds to three-quarters in each of the company’s past studies. While increasing confidence in mobile payment might sound great, Kount suggests it’s misplaced: Mobile fraud is increasing, and criminals are improving their techniques to exploit mobile devices.
Not all of the survey’s results are negative. Merchant support for contactless NFC payments is said to be up to 37 percent from 29 percent a year earlier, and support for mobile wallets generally increased from 22 to 29 percent in 2018. But Apple’s and Google’s specific mobile payment solutions took hits in favor of other alternatives.
While the findings don’t appear to track with broader reports that show Apple Pay and Google Pay eking out greater success as they expand in geographic and bank support, there are a few possible explanations. Kount VP Don Bush told VentureBeat that merchants — particularly mobile ones with limited screen sizes — may have tested Apple Pay and Google Pay badges only to find them unpopular, pulling them in favor of rivals Venmo or PayPal. Additionally, app users may have locked in their payment details and preferences long ago, negating the need for merchants to offer new services. The result, Bush says, will likely be a consolidation of payment options after the dust settles from new and existing players.
Another possibility is that the survey’s 600 merchants aren’t representative of broader trends. Kount’s business is helping “businesses boost sales by reducing fraud,” and its survey was conducted in association with PayPal-owned Braintree, polling merchants ranging in revenue from under $5 million to over $250 million. Uptake of a new payment solution by large companies and banks with hundreds of outlets can have an immediate and disproportionate impact on the availability of that solution, and that’s the sort of growth Apple and Google have recently been focusing on.