I see more people than I’d expect suggesting that enabling digital wallets for payments on the iPhone is massively dangerous and would lead to widespread fraud and I’ve even seen suggestions that these wallets would charge users a service fee to run all transactions.

I’m not here to tell you that every single player in payments is an angel, but as I wrote a few weeks back, I think there is a fundamental misunderstanding of how competition works in payments.

And as I like to say, we don’t need to speculate on what other popular wallets might do because we already know them, and by the numbers, most Americans use them already. A report from last year showed the top 5 digital wallets in the United States to be:

1. PayPal (used by 71% of US adults)
2. Cash App (44%)
3. Venmo (39%)
4. Google Pay (36%)
5. Apple Pay (31%)

What this looks like to me is rich competition where there are multiple good options for consumers, and while you personally may choose to not use some of these yourself, I think it would be disingenuous to argue that these non-Apple options are evil or are out to scam users. User experience is king when it comes to many products in the payments space, and that’s where companies compete today.

Here’s a few other interesting tidbits from the report:

2023 worldwide digital wallet transaction volume was $3.1 trillion for e-commerce and $10.8 trillion for card-present (aka tap-to-pay at a physical location). Of note, that second part is where Apple currently blocks third party wallets from playing.

This quote stuck out to me as well:

Today, retail payments need to be fast, secure and easy for starters. But that alone is no longer sufficient. Consumers are increasingly creatures of choice when it comes to how they pay, and so retailers need to work harder to satisfy this increasing demand.

Again, while I see skeptics on social media talk about how insecure and intentionally bad financial companies want to make their software, internally those things are table stakes and competition happens in delivering more to customers so that they choose to use the best product (which we all hope is ours).

So yeah, we can debate whether apps besides Apple Wallet should be able to work for card present transactions, but let’s not pretend that the main Wallet competitors are skeezy criminals who want to give you a shitty user experience and share your plain text card info on GitHub or whatever. These wallets already exist, they already consider security table stakes, and they compete on user experience, just like we’d all want. If Apple Wallet is great, then it should hold up well to competition, and we can already see how it does in e-commerce where it actually has to compete today.