Many believe the United States is the biggest potential market for Apple Pay.
Ultimately, this assertion may be true. But here’s a startling reality: Many countries are well ahead of the US in terms of the everyday use of contactless, chip-based technology for making payments. Among them is Japan.
The Japanese have adopted smart cards and mobile devices for years as a bonafide means of making monetary transactions. In the US, it’s been a slow-moving progression plagued by bureaucracy, politics, lobbying, finger-pointing, and selfishness.
However, these cards are not only for buses, trains, or subways. They’re also accepted in retail outlets, notably convenience stores which are way more popular and coveted by the Japanese than they are in America.
And smart cards can also be used to make purchases at the thousands upon thousands of vending machines on practically every street corner.
Contactless payments have been a way of life in Japan for over a decade. Contrast that with the United States, where there have been several unsuccessful fits and starts mired in a complicated web of bureaucratic red tape.
Apple Pay represents the greatest potential for the success of contactless payments, but only because of the massive popularity of iPhones.
As opposed to America, though, Japan is where Apple Pay is likely to be very successful.
Apple surely realized the same when they introduced Apple Pay to Japan in September 2016. They knew compatibility with public transport there was going to be key to success, so they adapted iOS devices specifically for the Japanese market.
Suica, PASMO, and other smart cards in Japan are based on FeliCa, an RFID smart card system developed by Sony and an early form of NFC (near field communication). Although Apple had already designed iOS devices to include NFC for Apple Pay, they had to modify their designs to include FeliCa for the Japan market .
If you purchased an iPhone 7, iPhone 7 Plus, or Apple Watch Series 2 in Japan, you can take advantage of the opportunity to use your mobile device for Suica and replace your smart card. Apple offers extensive information on using Suica on an iPhone or Apple Watch.
In the US, Apple Pay adoption is still about just getting people used to the unfamiliar concept of making a wireless payment at a point of sale. In Japan, well, they’re seen it and done it for years. That’s the essential reason why the uptake of Apple Pay will very likely be much faster there.