Apple Pay gets its first real iPhone wallet competitor

The news: Norwegian payments startup Vipps is the first third-party mobile wallet to enable contactless payments on iPhones after Apple opened up access to its NFC technology, per a press release.

• Users in Norway can now tap to pay through the Vipps app rather than using methods like scanning QR codes.
• They can also make Vipps the default wallet on their iPhones, letting them double-click the side button to activate Vipps’ tap to pay function.

SpareBank 1, DNB, and 40 other local banks have access to the capability, per Vipps, with more banks on the way.

How we got here: Apple finally started opening up its walled garden to resolve antitrust investigations from both the EU and the US.

Apple made its NFC tech available to developers in the US, the UK, and five other markets in the iOS 18.1 update. To use the tech, developers have to enter into a commercial agreement with Apple and pay fees.

What this means: This could open the floodgates for more competing wallets on the iPhone.

• Google Wallet stands to gain the most. It already has 36.3 million US proximity payment users, per our forecast, and getting access to Apple’s 132.5 million iPhone owners (of whom 61.3 million use Apple Pay) could be a game changer.
• It could also be a big opportunity for other device-agnostic payments apps that don’t offer contactless payments—like BNPL firms Klarna and Affirm. That could help them finally break into in-store retail.

Our take: On its own, Vipps isn’t going to take down Apple Pay’s preeminence. But we expect this will be the first of many mobile wallets to take advantage of Apple’s NFC tech, and the sheer number of competing wallets that launch on the iPhone could substantially erode Apple Wallet’s user base.

But Apple users are also notoriously loyal, and without a clear incentive for switching to a competing wallet, attrition from current Apple Wallet users may be slow going. Instead, competing wallets will likely focus their energy on attracting users who don’t yet use any wallet.

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