Target has accepted Apple Pay in its mobile app since Apple’s mobile payment service launched in 2014, but the retailer still doesn’t take Apple Pay in stores. Now Target is planning to introduce its own mobile payment solution later this year which suggests Apple Pay support in stores isn’t coming any time soon.
Recode reports that Target is planning to let customers use the retailer’s REDcard debit or credit card through a smartphone app as a payment method later this year.
Instead, Target plans to introduce mobile payment features to one or more of its own apps, the retailer’s Chief Information and Digital Officer Michael McNamara told Recode last week at a National Retail Federation conference in New York City.
This strategy is similar to what Walmart, another major Apple Pay holdout in the US, has offered rather than adopting contactless payment methods.
Chip-enabled debit and credit cards are more secure than traditional cards, but the payment terminals typically make the payment process slower than swiping. Contactless payment methods like Apple Pay can be used by waving an iPhone or Apple Watch near the terminal for a nearly instant transaction and is also more secure than using a traditional card.
While Walmart and Target are checking the ‘pay with smartphone’ box with their own services, paying through apps that require scanning barcodes is usually the least convenient payment method especially compared to Apple Pay.
Target’s CEO has expressed interest in accepting Apple Pay in stores before, although that was before the 2015 holiday period. When we asked Target for an update on this timeline back in November, the company offered “no updates or new news to share at this time.”
Apple Pay adoption by retailers is slowly picking up with 35% of US retailers accepting it at checkout according to Apple, and GAP retail stores are planning to start accepting Apple Pay this year.