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3
min read
· Posted on
February 21, 2024

Apple will turn iPhones into credit card readers

It might mean that Square's credit card reader dongles are redundant...or so the sharemarket thinks.

What's the key learning?

  • Apple is looking to create a new feature that enables iPhones to read credit cards
  • It means merchants will be able to accept credit card payments without further equipment
  • Square's share were sent down on the news
  • Innovation can reduce profits of incumbents and eliminate jobs.

Background: Apple is pretty much always at the forefront of new technology - even in the payments space.

What happened: We know Apple has Apple Pay for consumers...but now, Apple is taking this tech one step further with a new feature called Tap To Pay for merchants.

What else: It will allow merchants (like your local cafe or market stall) to accept contactless payments, without any extra equipment. Which kinda makes those Square credit card dongles a 'lil redundant. Or at least the sharemarket thought so.

So what's the key learning?

💡Innovation is generally a good thing. It can make us more productive, create new jobs and push down prices in the industry.

💡But the flip side is that innovation can reduce the profits of incumbents and eliminate jobs. Take Uber for example: the founders and gig economy workers won, but taxi drivers lost.

💡It's a fine line to toe, and right now, we could be about to see companies like Square potentially lose big to Apple's innovations.

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