Myron Melnyk
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Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Learn how to implement Apple Pay and Google Pay for your business

January 09, 2019

7 mins read

Worldwide, around 253 million consumers use Apple Pay. However, despite such a high adoption rate, the rollout of this technology has been a bit slow. Since its launch in October 2014, only 25 countries have supported Apple Pay. Some major Australian banks have even tried to collectively boycott digital wallet integration. And Germany, one of Europe’s technology hubs, started supporting Apple Pay only in December 2018.

Number of users of selected global mobile payment platforms

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Source: Statista – Global mobile payment platform audiences

But why do such in-demand technologies as Apple Pay and Google Pay face obstacles on their way to international markets? Why do governments and financial institutions not rush to adopt the technology?

Let’s find out what blocks mobile wallet implementation today. Let’s also see what perks digital payments provide to the financial industry, merchants, and consumers.

Digital wallet payments are growing fast

Over the past few years, digital wallets have exploded in popularity and grown into a billion-dollar industry.

Offering increased convenience and security, digital wallets are now at the forefront of payment methods. As of September 2018, one in two transactions in Europe uses a contactless payment method.

European digital wallet landscape

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Source: Mobey Forum – European digital wallet landscape

Europe is pioneering the adoption of contactless technology and aims at a cashless economy. In general, we see Apple Pay getting more popular overseas than in the United States, it’s country of origin, — only 15% of Americans use this technology. The rest 85% of Apple users come from Europe. Thus, European consumers are not only ready but even enthusiastic to embrace new technologies that offer increased comfort.

It’s actually Millennials and Generation Z driving the adoption of mobile payments. According to recent research by Payfort, 64% of people aged 18 to 25 use a mobile wallet to make purchases. But other generations are catching up: 40% of Generation X respondents and 17% of Baby Boomers say they have used contactless terminals and mobile phone wallets. Moreover, half of respondents believe that cash will be phased out in the next twenty years.

These numbers give food for thought for banks and other financial institutions. More and more people see the benefits of digital wallets and plan to use them as their preferred method of payment. It’s high time that FinTech companies respond to their needs.

Read more: Learn how to avoid contactless payment fraud and improve contactless card security with the best financial technology practices

Going mobile: when smartphones and wearables replace chubby wallets

On average, people are online around 24 hours a week, which is twice as long as only 10 years ago. We carry our social lives, work, entertainment, and knowledge base literally in our pockets — everything’s on a smartphone now. We can barely imagine our lives without this device and check it every 5 to 8 minutes. In some European countries, the number of smartphones exceeds the number of residents, which means a lot of people own more than one device.

All of these people are potential Apple Pay and Google Pay users.

Smartphone ownership in Europe

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Source: Flurry Analytics

Not only smartphones support contactless payments — they’re even more convenient with wearables. Consumers can tap a smartwatch at a terminal to complete the purchase. With the global wearables market getting larger every year (and predicted to double by 2021), smartwatches are becoming another touchpoint for digital payments.

Global wearables sales by category from 2014 to 2018 (in million units)

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Source: Statista – Global wearable technology sales by category from 2014 to 2018 (in million units)

Among European countries, Germany has one of the highest rates of smartphone ownership. The most popular mobile operating systems among smartphone users in Germany are Android and iOS, with 67.7% and 31.19% of the market share respectively. That’s why, with Google Pay and Apple Pay being the major digital wallets, it was important to implement both systems to satisfy users.

Mobile operating system market share in Germany

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Source: Statcounter – Mobile operating system market share

Nevertheless, Google Pay came to Germany only in June 2018, and Apple Pay appeared a few months later.

The thing is that Germany has historically been a cash-loving country, with a physical wallet being a key part of the average German’s urban survival kit. But Generation Y calls for convenient mobile payment services: 57% of banking customers in Germany are even ready to switch their bank to get access to contactless mobile payments.

New generations are open to new opportunities for payment processing. Take digital wallets. Prior to the launch of smartphone payments, Germans had been actively using e-wallets. Almost 21 million Germans had an online PayPal account linked to their bank account. Google Pay decided to use this to push their technology faster, partnering with PayPal in Germany. This move allowed Google Pay to access a huge customer base in the country. Plus, four banks in Germany also confirmed support for Google Pay: Comdirect, N26, Commerzbank, and Wirecard.

Apple Pay also partners with some of Germany’s most powerful banks and FinTech giants, including Deutsche Bank and N26.

But some leading German banks, for example Sparkasse, refuse to support the technology. They see potential in mobile payments but would rather develop their own smartphone payment solution instead of sharing their client base with another service provider. This is why lots of German financial institutions haven’t rushed to adopt Apple Pay and Google Pay technologies, even actively working to slow the penetration of these mobile wallets.

German banks and financial institutions that support mobile wallets

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Contact us to painlessly implement Apple Pay and Google Pay into your FinTech solution
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Apple Pay vs Google Pay: how they work

Now let’s define how digital wallets work and what is required for their implementation.

How they work for users is quite simple:

  • Download an app on your phone: either your bank’s app or a digital wallet app.
  • Load cards you’d like to use for contactless payments: credit cards, debit cards, loyalty cards, and even coupons.
  • Tap your phone at a contactless terminal.

Mobile wallets use Near Field Communication wireless technology (NFC technology) to read card data linked to a user’s Google Pay or Apple Pay account.

To accept Apple Pay and Google Pay in stores, merchants need to have a contactless point-of-sale terminal. If a store accepts contactless card payments already, there should be no problem configuring the terminal to accept mobile payments as well.

This technology is simple for consumers. But what about implementing e-wallet payment methods on the part of financial institutions?

Each payment service offers two activation methods: via a wallet app or a banking app. Usually, mobile wallets need third-party SDK providers, digital directories, or payment processors like uPaid and petaFuel as well as an experienced software development company to connect everything in a single app.

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Both Google Pay and Apple Pay have a set of standard requirements for financial institutions to follow if they wish to support these payment services. This way, Google and Apple make sure their services work smoothly and flawlessly no matter the provider.

Take Apple Pay: its program requirements are divided into eleven primary categories:

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

As for Google, their development and integration requirements are divided into three stages.

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Neither Apple Pay nor Google Pay will activate their service unless all requirements have been met.

Read more: Learn how we helped the first fully digital bank in Germany integrate Apple Pay and Google Pay for secure contactless payment processing

Apple Pay and Google Pay integration for contactless payment processing

Why have mobile wallets become so popular?

Guide to Mobile Wallets: Apple Pay, Google Pay, and How They’re Transforming FinTech

Digital wallets have exploded in popularity because of the advantages they offer both to consumers and merchants. Combining convenience, flexibility, an improved shopping experience, and — what’s most important — increased security, mobile payments have become the top option for everyday transactions. Each transaction on a consumer’s smartphone or smartwatch requires a passcode, Face ID, or Touch ID, which reduces fraud. If a customer loses their phone, no one can access their money. And we all know that if you lose a wallet, it’s goodbye to all the cash and cards in it.

There are single-purpose and multi-purpose wallets, so consumers can choose which option suits them best. Single-purpose wallets are usually branded apps that work for one payment service only. Multi-purpose wallets allow users to store several debit and credit cards as well as gift cards and loyalty coupons. With all the different payment and loyalty cards in one app, this second type of app is more like a replica of a physical wallet.

As for merchants, accepting Apple Pay and Google Pay is faster than accepting traditional payment methods, even debit and credit cards. Plus, every transaction is secured with payment tokenization: a merchant doesn’t receive the customer’s actual card details, but rather a randomly generated token. This way, no debit or credit card numbers are stored in a merchant’s system when customers pay with a mobile wallet.


As a software development company, Intellias provides digital wallet integration services, helping financial institutions successfully adopt mobile payments. Contact us to painlessly implement Apple Pay and Google Pay into your FinTech solution.

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