2 Drug Chains Disable Apple Pay, as a Rival Makes Plans 

A consortium of merchants plans to introduce a payment system next year that will supplant the use of credit and debit cards.

Apple Pay, the Silicon Valley giant’s highly anticipated mobile wallet, has been available for only one week but already may be inciting a battle within the payments industry.

Over the weekend, Rite Aid and CVS disabled Apple Pay from working in their stores nationwide. The reason was not immediately clear.

Ashley Flower, a spokeswoman for Rite Aid, said the company “does not currently accept Apple Pay.” She added that Rite Aid was “still in the process of evaluating our mobile payment options.”

Analysts said disabling acceptance of Apple Pay was a way to favor a rival system that is not yet available but is being developed by a consortium of merchants known as Merchant Customer Exchange, or MCX. Rite Aid and CVS are part of that consortium.

“Clearly Rite Aid and CVS are making a business decision over a customer satisfaction decision,” said Patrick Moorhead, president of Moor Insights & Strategy.

He added that the move could upset consumers who believe Apple’s new product is easier and safer than paying with a traditional credit card.

Apple has not released data on how popular its new product is. But on Apple Pay’s first day, at Chase banking services seven times more people added Chase credit cards to Apple Pay than signed up for new credit cards, Avin Arumugam, Chase’s digital executive director, said in an interview with Bloomberg.

MCX has time, however, to alter its strategy before releasing its product.

The battle will surely escalate in the coming months as companies like PayPal and Google update their mobile wallet strategy to deal with the fast-changing market. But for now, many are betting on Apple Pay as the mobile wallet to beat.

“Apple Pay is the most convenient, most secure, and what’s best for consumers,” Mr. McLaughlin of MasterCard said. “That’s what will win out in the end.”

Source: NYT- 2 Drug Chains Disable Apple Pay, as a Rival Makes Plans

---