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Report: Half of Apple Pay Users Have Used It Just Once

April 1, 2015
Personal Finance
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Adoption of Apple Pay, the tech giant’s mobile payment tool, has been impressive. But a new report says nearly half of the people who have tried it out have used it only once.

Similarly, nearly half of users said they’ve gone into a store that supposedly accepted Apple Pay, only to find out it really didn’t, according to the report.

That’s according to research from Phoenix Marketing International, which polled 3,002 credit card users as part of an ongoing study.

Apple Pay launched on October 20. Apple CEO Tim Cook said last month that Apple Pay, which started with six partner banks, had expanded to more than 2,500 participating institutions. Nearly 700,000 locations were accepting the system as of the March 7 event where Apple Watch was launched, Cook said.

The Phoenix report had even more positive numbers for the system. Eleven percent of all credit-card holding households and 66% of iPhone 6 owners had activated Apple Pay.

The research estimated that, four months in, the Apple Pay user base was about 12 million people — impressive for card-free, mobile-payment technology that has caught on in parts of Asia and elsewhere but has struggled for a foothold in the United States.

“However, the early-on transaction potential is being undercut by low repeat usage and lost payment opportunities,” said Greg Weed, director of Card Research at Phoenix, in a news release.

According to the report, 48% of people who have used Apple Pay have  used it only once.

There may also be some frustration among those who tried and failed. Fifty-nine percent of Apple Pay adopters said they had gone into a store attempting to make a purchase. But 47% of them said a store that was listed as an Apple Pay merchant either didn’t really accept the system or wasn’t yet ready to do so.

Weed said Apple needs to do more to help users avoid that kind of experience.

“Since Apple Pay is still in an introductory mode and the NFC (near field communication) acceptance network still has a long way to go, adding a continuously updated ‘local store directory’ to the Passbook app is a necessary, short-term product improvement,” he said.

Passbook is an app for Apple’s iOS mobile operating system that stores debit-card and other information and works with various payment methods, including Apple Pay.

The Phoenix report is the first installment in what’s planned to be surveys of 16,000 people in 2015, monitoring Apple Pay and other new or revamped “mobile wallet” systems scheduled to enter the market.

Google is reported to be working on a new payment system at least tentatively called Android Pay.

The system, which could debut at Google’s developers’ conference in May, would, like Apple Pay, allow retailers to add a button to their mobile apps or technology at their physical cash registers to accept it.

Google beat Apple to the mobile-payments punch with Google Wallet in 2011. But Wallet has failed to catch on with retailers and consumers as quickly and widely as Apple Pay has.

Doug Gross is a staff writer covering personal finance for NerdWallet. Follow him on Twitter @doug_gross and on Google+.