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Apple vs. Banks: The Digital-Wallet War, Explained | WSJ

The Wall Street Journal

1.3M Views . 2023-03-29

Digital wallets like Apple Pay are continuing to grow in popularity. Banks are worried they’re losing ground to tech companies eager to gain market share in consumer payments. One of traditional finance’s biggest threats is Apple. Here’s how big banks are fighting back. 0:00 How digital wallets like Apple Pay work 0:43 How banks are competing against Apple Pay 3:45 Can banks succeed in creating their own digital wallets? News Explainers Some days the high-speed news cycle can bring more questions than answers. WSJ’s news explainers break down the day's biggest stories into bite-size pieces to help you make sense of the news. #ApplePay #DigitalWallet #WSJ

This segment examines the increasing popularity of digital wallets like Apple Pay and how they are challenging traditional banks. While Apple Pay is not the first digital wallet, it gained an edge by being integrated with iPhones, which are widely used in the US. Banks are worried that Apple Pay's dominance could threaten their business, as Apple collects fees from transactions and is encroaching on their territory.

Apple Pay
Digital wallets
Banks
Financial technology

  • Apple Pay has become a popular digital wallet, especially for online payments, and is posing a threat to traditional banks.
  • Banks are concerned about the financial impact of Apple Pay, as it takes a cut of every transaction and could potentially replace traditional banking services.

Insights from the YouTube Video:

1. The Rise of Digital Wallets: A Threat to Traditional Banks? The video highlights the growing popularity of digital wallets like Apple Pay and the increasing concern among traditional banks about their potential impact. It suggests that these wallets could erode the banks' existing revenue streams and lead to a shift in customer loyalty towards tech companies.

2. How Apple Pay Disrupted the Payment Landscape: Apple Pay's success stems from its integration with iPhones, making it a convenient and nearly indispensable payment method for iPhone users. It also benefited from the willingness of banks to pay interchange fees, ensuring its widespread adoption.

3. The Impact of Interchange Fees on Bank Revenue: The video

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