May 6, 2015

One of the most significant skirmishes in the ongoing battle over mobile payments supremacy involves a major American electronics retailer, an iconic tech brand and an industry giant. According to a recent report published by the Wall Street Journal, Best Buy could be the next major retail chain to accept Apple Pay in the United States.

Apple Pay is an advanced electronic payments system that can transform an iPhone 6 or iPhone 6 Plus into a mobile wallet. The iPhone, along with its various accessories and peripherals, is a major selling item at Best Buy; for this reason, the move to accept Apple Pay seems like a smart decision. However, such a move will impact the store’s current relationship with Merchant Customer Exchange (MCX).

Best Buy currently uses MCX as its preferred system for mobile payments. MCX utilizes its own mobile wallet system, called CurrentC, which is proprietary. Best Buy is not the first major MCX client to accept Apple Pay; the iconic CVS and Rite Aid drugstore chains in the U.S. have also made the iPhone their favorite mobile wallet.

At this time, Best Buy is not completely switching over to Apple Pay; in fact, they can only use it through a combination of the store’s mobile app and their iPhone. Shoppers are currently free to use CurrentC and other mobile payments they may see fit to use when they purchase electronics. However, MCX is naturally concerned about the upcoming expiration of its exclusive agreement with Best Buy. Moreover, MCX is worried about the future of its proprietary electronic payments platform; after all, Best Buy is already planning on making the required modifications and upgrades to its cashier register network.

It stands to reason that MCX, a coalition of American providers of merchant services, should be worried about Apple Pay. MCX was organized for the purpose of joining strengths and efforts against the likes of Apple Pay, Google Wallet, PayPal, et al. To this effect, MCX applied its business acumen to secure exclusive contracts such as with Best Buy; alas, iPhone users seem to be warming up to Apple Pay in greater numbers.

It is unlikely that MCX will abandon the CurrentC platform or else give up without a fight. Innovation seems to be key in the mobile payments industry, and thus this is something that MCX should consider when the time comes to head back to the drawing board.

Categories: Mobile Payments

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