Apple Pay not expected in Canada any time soon

While Apple is heralding Apple Pay, itsnew mobile payment system,as a roaring success, Canadians shouldn't expect to use their newest iPhone to pay for goodsany time soon, as It's unlikely the company will be rollingout the servicein Canada in the immediate future.

"Apple has given no indication as to when it will come to Canada or even if," said analyst TroyCrandall, of MacDougall, MacDougall & MacTier. "However, it is logical that it issomething they are likelyworking on for the future. But is Canada one of the main priorities? I would probably say no."

Apple Pay lets users of the newest models ofiPhones and iPads pay for purchases through their devices on credit or debit card accountswithout having to show their card or account number.

On Monday, during a tech industry conference in California,Apple chief executive Tim Cook said the payment system had more than onemillion activations in the first three days after it became available, and is now more widely used than anycompeting payment system.

I think it's the novelty," Crandall said about Apple Pay's success. "Apple's kind of made it a fun way to pay."

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Making people part with their money is the most difficult part of the transaction, Crandall said, and "ifyou can actuallymake that part fun, thats really powerful.And Ithink thats whatApple has successfully done. Theyve made it easy, and theyve made it fun."

Contacted by CBC News, a spokeswoman for Apple would not say when or if there were any plans for offering the system into Canada,. She referred to the speech Cook gave on Oct. 14, which made no mention of any plans for Canada.

China probably next target

"I wouldn't say Canada isnecessarily apriority,"Crandall said, adding that China is probably Apple's next target. Indeed, Jack Ma, executive chairman of the Chinese e-commerce giant Alibaba,told the same audience at this week's California tech conference that he would be "very interested" in teaming with Apple to bring Apple Pay to China.

Canada certainly poses no technological barriers for Apple Pay. The system is based on a near-field communication (NFC) chip, whichtransfers encrypted data from one device to another. Many Canadian retailers and servicesalready usesimilar technology with theuse of Paypass, which allows users to just tap their debit or credit cards onterminals in order to pay.

The launch of Apple Pay in Canadawill be based partly on how cumbersome it will be to introduce from a regulatory standpoint.

"If it's going to be pretty tough, they'll just probably focus on the easier [countries] first," Crandall said.

Not only would Apple Pay have to comply with Canada's privacy regulations, it would also need the approval of the banks, which aremuch more conservative than their American counterparts.Since banks issuecredit cardsand debit cards (which can also be used in Apple Pay),Apple would need to enter into a partnership with the major Canadian banks, as it did with major banks in the U.S.

Canada better suited for Apple Pay

"There's a goodargument to saythatCanadais better suited environment for Apple Pay to launch, becausewe alreadyhavethesetap-to-pay terminalsinstalledthroughout Canada, and we're alreadyusing them," saidBrian Jackson, editor of ITBusiness.ca. "It's really a deal with the banks that has to be done."

However, Jackson said it's possiblethat Canadian banks may set up obstacles,wanting to own mobile payments themselves, and create an app thatallows Canadians to pay through that avenue.

Earlier this month,Jeff Martin,vice-president and CIO of direct channels technologysolutions atTD Group, told a crowd at theMobile Enterprise Canada Summit that the bank is closely watching the developments of Apple Pay in the U.S, reported IT World Canada.

He predicted that Apply Pay is at least a year away from coming to Canada andnoted that U.S. banks and credit card issuers can make money from debit transactions while Canadian financial institutions do not.

There are a lot of regulatory things they will have to work out, he said. We have a mobile wallet. We can do what Apple Pay does. You could have done it a few months ago.

Better shopping experience

While Apple has entered partnerships with major U.S. banks and large retail chains including Macy's, Walgreen and McDonald's., critics have noted that Apple Pay isn't accepted by other large chains. Among them are the drugstore chains CVS Caremark and Rite Aid, which belong to a retail coalition working on a rival system.

Michael LeBlanc, senior vice president of digital retail for the Retail Council of Canada, said the organization supports anythat makes for a better shopping experience for our customers,

And to the degree it would do that, we broadly support it," he said.

"The other thing we look for issomething that helps our operating costs and ultimatelyallow us to lower our costs to consumers.To us, Apple Pay seems to be another layer in the paymentsupply chain versusa competitivepayment type."