Running Head: APPLE PAY AND PAYPAL 1

APPLE PAY AND PAYPAL

Student Name

Course Name

Institute Name

Date
APPLE PAY AND PAYPAL 2

INTRODUCTION

Apple Inc. developed Apple Pay as a mobile payment system and digital wallet. Shops, iOS

applications (including Messenger, Apple Store, and iTunes), and the web are where customers

can make purchases with Apple Pay, and Apple Pay Cash makes such purchases even easier.

With iOS 11.2, Apple Pay is built right in. It is designed to function instead of a traditional

plastic card with a point-of-sale system that supports contactless payments. The PayPal website

offers a money transfer service that both consumers and companies may use. Between the seller

and the financial institution (bank or credit card company), PayPal mediates the transaction.

Customers may now use their PayPal accounts to make purchases from the App Store, Apple

Music, and iTunes, among other Apple services, thanks to a partnership between the two

companies (Pang, 2020).

STRATEGIC ALLIANCE

Ultimately, the partnership aimed to alter the status quo of payment processes. Indeed,

discussions have been placed between PayPal and Apple for PayPal to become a "preferred

payment mechanism" for Apple Pay. For the fingerprint scanner on the Galaxy S5, PayPal

teamed together with Samsung. It has been reported that PayPal's ex-president was totally

against the Samsung arrangement since he knew it would hurt PayPal's standing with Apple

(Colt, 2014).

However, Apple was so irritated with PayPal that the company decided to exclude PayPal from

Apple Pay entirely. Apple was reportedly so incensed by PayPal's partnership with Samsung that
APPLE PAY AND PAYPAL 3

it decided to no longer work with PayPal on Apple Pay. This is why both businesses eventually

failed.

RESTRUCTURING RECOMMENDATION

As a result of working together, both companies should see growth in their customer bases. The

collaboration should result in creating a payment system that is both efficient and secure for its

users. Both businesses will have to overcome the risks associated with a plastic card, such as the

possibility of loss or theft. The partnership must develop a product that compels consumers to

acquire Apple products and join up for the PayPal payment method.

REFERENCES

Colt, S. (2014). Apple was going to partner with PayPal on Apple pay until it found out PayPal

was working with Samsung. Business Insider. Retrieved November 23, 2022, from

https://www.businessinsider.com/apple-pay-and-paypal-partnership-failed-2014-9

Pang, R. (2020). The growth of payment apps like Alipay, Apple Pay, and WeChat Pay in two

major markets, the risks and the benefits, and the relations with traditional finance (Doctoral

dissertation).