IT companies have gone from being data banks to financial banks, as the latest developments at Apple Pay in Canada suggest.
While Facebook (NASDAQ:FB) applied two years ago for a banking licence in the United States and has since begun developing initiatives to offer methods for its users to store cash and pay for services via the social network, Apple (NASDAQ:AAPL) is formalising relations with Canadian banks
On Tuesday, Apple Pay expanded to two major Canadian banks RBC and CIBC. Meanwhile, TD Canada Trust, Scotiabank, and BMO are expected to follow in the month ahead, providing a service across the country's "Big Five" financial institutions. ATB Financial and Canadian Tire Bank also support Apple Pay as of Tuesday.
BMO hastily issued a press statement on Tuesday lest the banks opening to Apple Pay steal its thunder.
"We have a long track record of bringing to market innovative products and services that help enhance and simplify our customers' lives. The introduction of Apple Pay for BMO customers is the latest example," said Cameron Fowler, Group Head, Canadian Personal and Commercial Banking, BMO Financial Group.
He added that the adoption of mobile payments has accelerated since BMO launched Mobile PayPass Tag in 2011. "This is a natural next step in this journey that we're taking with our customers in Canada, as well as the United States - where we've been offering Apple Pay for the past year," said Fowler.
The expansion includes varying support for international brands such as Visa, MasterCard, and Interac, covering most major debit and credit cards in Canada. Supported cards can be scanned or added manually to Apple Pay by tapping the "Add Credit or Debit Card" option in the Wallet app on iOS 8.1 or later on compatible devices.
Apple Pay can be used virtually anywhere contactless payments are already accepted in Canada, including at Apple Stores, Canadian Tire, Chapters, Coles, Indigo, London Drugs, Mark's, McDonald's, On The Go, Petro-Canada, Pizza Hut, Staples, Tim Hortons, and many other retailers nationwide.
Apple Pay support is also coming soon to Air Canada, Aldo, Domino's, Pizza Pizza, Zulily, and the TTC transit system in Toronto. Additionally, the payments service can be used in apps such as Apple, Delta, Etsy, Fancy, Groupon, Kickstarter, Priceline, Starbucks, Ticketmaster, Uber, and Zara starting in June.
Apple Pay was previously only available in Canada for non-bank-issued American Express cardholders since last November.
The new competition will bite banks already reeling for years of heavier regulation in the wake of the 2007 financial crisis. But strictly speaking, Apple Pay is not taking on the areas of banking where regulation is toughest or expensive. It is picking off the easy side of banking.
Apple shares were up 0.3% at $93.08 on Tuesday.
Until Apple Pay is available to buy stocks, there is still the use of the bourse. Today's other risers and fallers as follow:
RISERS
Microsoft (NASDAQ:MSFT) shares edged 1.8% higher to $50.94 after investors received well news that Microsoft is shutting down its China web portal, preferring to focus on software and services for Windows 10 devices.
Allergan (NYSE:AGN) shares gained 4.4% to $223.03 aftertThe drugmaker announced a $10bn share buyback programme, planning to execute up to half that amount over the next four to six months. Separately, Allergan reported adjusted quarterly profit of $3.04 per share, beating estimates by 3 cents a share.
FALLERS
SolarCity (NASDAQ:SCTY) shares sink by 23% to $17.33 after the company posted an adjusted loss of $2.56 per share, wider than the $2.32 a share expected by analysts. The solar company's revenue did beat Street forecasts, but the company also cut its forecast for solar panel installations for 2016.
Gap Inc. (NYSE:GPS) shares fall 12.5% to $19.10 after tThe apparel retailer posted lower-than-expected quarterly sales and also issued an earnings warning. Gap has been hurt by weak demand at both the Banana Republic and Old Navy chains.