ApplePay or Googlepay? Using it or accepting it…

Since the 2 newest tech phones have hit the market (IPhone 8 or Samsung Galaxy S8) there’s a pretty good chance if you have a cell phone, it’s probably a smart phone.  I’m not sure too many flip phones are still in use or even working for that matter.  With the ability to control everything from your home security system, setting your DVR to record tonight’s game or paying bills while sitting on your couch, I think the smart phone is here to stay.

Another feature that has been gaining traction in the last couple of years is ApplePay or GooglePay.  If you have a smart phone, do you use it?  If you are a business owner, do you accept it?  My question to you if you don’t is,  “WHY NOT”???

The technology behind ApplePay and GooglePay is nothing short of amazing!  There are a number of well written articles about the intricacies of how it works which I’m not really going to get into.  I’m just going to give you my recommendation followed by my reasoning.


Here’s why…For you, guys, take out your wallet.  How many credit cards are in there…?   Three, Four…more?  Ladies, how many cards do you have in your purse?  Well, every time you go to a store and take out one of those cards, you are increasing your chance for fraud.  If you wallet gets stolen or lost, those card numbers are compromised.  Same goes for your purses ladies.  When you use your smart phone, your card number is linked to your phones account and stored in your ‘wallet’ (for the Apple users anyway)

When you pay using your smart phone, your not paying with your actual credit card number.  The phone converts the number to a randomly generated number.  That process is called ‘Tokenization’.

The easiest way I can think to explain it is like this.  When you walk into a store to shop and you pay with your credit card, the credit card number is being used.  When you head down the street to store number 2 and use the same card, you’re using the same credit card number.  That should be easy to understand.  When, however, you link your credit card to your phone account, and use your phone to pay, a randomly generated number gets used instead of your credit card number.  When you go down the street to store number 2, and you again use your phone, another randomly generated number gets used for that transaction.  NOT THE SAME randomly generated number, but a different one.  And that number is only good 1 time for that 1 transaction.  SO even if someone was able to get the randomly generated number (which I highly doubt they could) it wouldn’t be any good.  It’s like you’re paying with a new credit card number every time you shop.  Converting your credit card number into a randomly generated number is the tokenization.

People ask me, “what happens if my phone gets stolen? They will have my information…”  They will have your information and that information will be stored on your phone. Which is exactly where you want it.  Because unless they also steal your code that unlocks your phone or cut off your thumb at the same time they steal your phone, it’s going to be useless to them.  That’s really where the beauty is.  You information is totally secure.  I’m certain that phones get stolen all the time.  In fact, mine went ‘missing’ a year ago in Vegas… (that was a bad day)  Regardless, my information was totally secure.  I was just a tad bit livid that I’d just forked out $800 for it 2 months earlier.  Unless I’m mistaken, I haven’t heard of a sudden spike in the number of thumbs going missing, so I’m pretty confident the information on those stolen phones is pretty safe as well.

Now, for you business owners out there, is there any debate on whether or not to accept ApplePay or GooglePay?  If there is, there shouldn’t be.

First off, it doesn’t cost you anymore to accept it unless you don’t have a terminal that has the capability.  That would be an expense. But the processing fees won’t cost you a single cent more.

Secondly, accepting ApplePay or GooglePay is more secure than accepting CASH!!!  Read that line again.

No, really…Read that line again… I’ll wait…

Let’s put it this way, cash can be counterfeited.  Unless someone walked into your place of business with 3 thumbs, I’d feel pretty confident that the person paying you with their smart phone is actually using their own credit card to do it. There is a slew of security protocols the banks have put in place to allow someone to store a credit card on their phone. The only person that has access to put the card on the phone is the rightful owner of the credit card.

By allowing your customer to pay with ApplePay or GooglePay, you are not only protecting yourself and your business from fraud, you’re protecting your customers as well.  If all of Target’s customers had paid with ApplePay or GooglePay, there would have never been a breach in 2013.  There would have never been anything to steal.

Apple claims there are roughly 220,000 stores that accept ApplePay in the US, but there are over 9 million stores in total that accept credit cards.  That’s a fraction.  Consumers lost more than 16 billion to credit card fraud and identity theft in 2016 alone.  That means of all of the money spent on credit in 2016 with businesses, $16 billion was fraudulent.  That is a direct loss to a business that affects the bottom line.  Not only does the business lose out on the money, in most cases, they lose that in product loss as well.  I’m not saying accepting ApplePay or GooglePay will eliminate fraud, but you can feel more confident accepting it than you should if someone pays with cash.

If you are a business owner and you’re not sure if you are currently set up to accept ApplePay or GooglePay, reach out to me and I can help you set it up.

Until next week,

I’m Ed Craft, your credit card guy!

15 years in the business and counting.


2 replies
  1. Duane
    Duane says:

    An intriguing discussion is definitely worth comment.
    I think that you should publish more on this subject, it might not be a taboo matter but generally people do not speak about these
    issues. To the next! Many thanks!!


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