Android Pay is a near identical clone of Apple Pay, but it won’t be anywhere near as lucrative, according to a new report. Unlike Apple, Google isn’t taking a cut from Android Pay transactions, so the service will literally be offered for free.
The Wall Street Journal reports that the reason for this is “because Visa Inc. and MasterCard Inc., which operate the dominant payment networks, recently standardized their “tokenization” card-security service and made it free, preventing payments services from charging fees to issuers.”
Tokenization is the system that swaps credit card data like account numbers, expiry dates, and security codes with a unique string of numbers (token) that can only be used once. It’s much safer than traditional transactions, because it means credit card details are never shared with merchants.
TechnoBuffalo, June 7, 2015
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