Apple Pay is accepted by more than 85% of U.S. retailers because it can make checkout faster, easier, and more secure. Shoppers can carry fewer physical cards and complete purchases with a quick tap of a compatible device.
Discover why some retailers opt out of Apple Pay. Explore the costs, hardware requirements, and data privacy trade-offs for merchants.
What Is Apple Pay and How Does It Work for Merchants?
Apple Pay is a digital wallet that lets customers add eligible credit cards, debit cards, and other supported payment methods to an Apple device. At checkout, the customer authenticates with Face ID, Touch ID, or a passcode, then holds the device near a Near Field Communication (NFC)-enabled payment terminal.
The wallet does not replace the customer’s bank account or available credit. Instead, it securely passes the payment request through the merchant and payment network to the card issuer, which approves or declines the transaction—usually within seconds.
How Apple Pay Tokenization Protects Merchant Data and Reduces Fraud
Apple Pay protects payment data through tokenization. Rather than sharing the cardholder’s actual card number with the merchant, it uses a device-specific account number and a transaction-specific security code. Because that code is designed for a single purchase, it cannot simply be reused for another transaction. Additionally, the customer’s physical card number and security code are also not stored on the device in a form a thief can readily retrieve. Learn more about how Apple Pay tokenization works.
For merchants, these safeguards can help reduce exposure to fraud and chargebacks. That added protection may be particularly valuable for card-not-present (CNP) merchants, which often face greater dispute risk and must carefully manage their chargeback thresholds.
6 Reasons Why Retailers and Merchants Don’t Accept Apple Pay
Despite these benefits, accepting Apple Pay is still a business decision—not an automatic upgrade. Merchants may hesitate for one or more of the following reasons:
Uncertainty about the technology.
Tokenization and cryptographic security can feel complex, especially to businesses with limited technical resources. If customer demand is unclear, the perceived implementation risk may outweigh the expected benefit.
Processing costs.
Digital-wallet purchases still carry payment-processing costs. Many merchants consider faster checkout and greater convenience worth the expense, but high-volume businesses may scrutinize every incremental fee.
Hardware and upgrade expenses.
Tap-to-pay transactions may require an NFC-enabled terminal and related system updates. Businesses with older equipment may be reluctant to replace a setup that already meets their needs.
Ecommerce integration work.
Enabling Apple Pay at a physical terminal may be relatively straightforward. Adding it to an ecommerce site, however, can require development work and coordination with the merchant’s processor or payment service provider.
Less control over customer data and checkout.
Some large merchants prefer proprietary wallets that keep more of the customer journey within their own ecosystem. Apple Pay’s privacy protections can limit the customer data available to the merchant.
Payment-provider limitations.
A processor may not support Apple Pay, may favor another contactless option, or may lack the technical capabilities or commercial relationship needed to enable it.
Case Study: Why Walmart Uses Walmart Pay Instead of Apple Pay
Walmart illustrates why a retailer might favor its own digital wallet. Walmart Pay keeps payment activity within the company’s broader ecosystem, supports customer engagement, and gives the retailer more control over data, fees, and the checkout experience.
Optimize Your Merchant Payment Strategy with Slyce360
Choosing which payment methods to accept requires more than following a trend. Merchants need to understand how checkout options affect customer experience, fraud exposure, chargebacks, recurring payments, and overall payment performance. Slyce360 brings those factors into one clear view so businesses can make more informed decisions and pursue stronger returns.
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