The next logical step for Apple Pay: a loyalty program

It could make more sense to use Apple Pay, if you were getting better rewards points for it.
It could make more sense to use Apple Pay, if you were getting better rewards points for it.
Image: John Minchillo/AP Images for MasterCard
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Soon, it may pay to use Apple Pay.

Close financial partners and job postings on Apple’s career page hint that the company is interested in more closely integrating Apple Pay into loyalty programs that reward customers for using the mobile wallet.

Retailers can tie their own loyalty programs into Apple Pay, so that people using the system can rack up points just as they would if paying by cash or a physical credit card. But as of yet, there’s nothing that allows consumers to earn more or different rewards for using Apple Pay specifically.

That could change, though, based on a recent job posting for a product manager sought by Apple Pay to “develop loyalty products and launch projects with merchants for those products.” The job posting specifies that other “key partners” would include “payment terminal vendors, Point-of-Sale providers and customer loyalty solution companies”—in other words, the full suite of companies that make it possible for consumers to earn, store, and spend points tied to loyalty programs.

The job post confirms what many industry experts in the payments space have been saying for years: Apple needs to get into the rewards game to make its mobile wallet more appealing to consumers.

So far, Apple Pay usage has been tepid. Piper Jaffray analyst Gene Munster estimates that only 20% of new iPhone users even activate Apple Pay on their phones. More robust incentives “definitely would be a catalyst to adoption,” Munster says.

The idea isn’t so wild. Google is already testing out a rewards program with its Android Pay mobile wallet.

Munster predicts Apple will lean on partner firms to develop loyalty programs, given Apple Pay’s track record of working with established institutions rather than reinventing financial systems on its own.

Apple declined to comment.