Amazon / Apple / Braintree / Dwolla / Facebook / Google / ISIS / Square / Stripe / Telcos / Whoever Payments—the reality …

“My theory, which I stick by today, is that AAPL’s end game is to develop a broad-reaching e-commerce engine that will compete not only with PayPal, but also [with] traditional credit card companies. More recently, some of the pundits that cover AAPL have arrived at similar conclusions.”—Paul McWilliams, supposed “technology stock expert”. …
“Back in 2012, I wrote that Apple would eventually kill off Visa and MasterCard on thestreet.com.”—Forbes Contributor, Richard Saintvilus.
http://www.forbes.com/sites/schifrin/2014/06/04/are-mastercard-and-visa-in-apples-crosshairs/

“Apple, or any future competitor that has already built a base of trust, could begin tomorrow and charge half the commission of eBay, Visa, or MasterCard, … and the concept of real competition [for eBay’s “PreyPal”] in the space is farfetched for the next few years.”—John Ford, SeekingAlpha Contributor [either an eBay shill or, more likely, simply a fool] …
http://seekingalpha.com/article/2256903-ebay-quality-at-a-very-attractive-entry-point

What nonsense! Do any of these commentators have any understanding of how the retail banks’ payments system actually works, or how eBay’s clunky “PreyPal” actually works (or, too often for the merchant, does not work)?

The safe way: Payer’s Bank > Credit/Debit Card > Merchant’s Bank.
The other way: Payer’s Bank > “PreyPal” > Credit Card/ACH > Merchant’s Bank?

The professional payments networks, ie the "bankcards", Discover (~2%), MasterCard (~33%) and Visa (~52%), plus Amex (~12%), still process ~99% of the world's retail payments between them, and the "bankcards" already offer an "instant loan" model—for what otherwise is a "credit" card? And, Amex will have difficulty growing its market share any further because it has little chance of ever matching the vast merchant coverage of MasterCard/Visa until it matches the lower merchant discount fees charged by MasterCard/Visa …

So, notwithstanding the constant talk of “disruption”, it appears that nothing has yet “disrupted” the two major bankcards; and I have no doubt that absolutely nothing in Apple’s “mobile” plans (short of buying their own bank, which still will not give them unfettered, interactive access to depositors’ funds in other banks, except via MasterCard/Visa) will disrupt the existing bankcards. The fact is, Apple does not now have interactive access to depositors’ funds in retail banking accounts, nor is Apple, or anyone else, ever likely to get that access—except via MasterCard/Visa; any other way is at the ultimate merchant’s peril, as the great many negative stories all over the internet about “PreyPal” attest.

Like all the other pretenders, “Apple Payments” will always be riding on the back of the same retail banking networks that they currently do, via their own retail banker, as simply one more, albeit very large, "Credit Card Merchant Account" operator. And, any credit that Apple might offer to supply will still have to be provided via an agreement with a licensed and regulated credit provider (ie, a real bank), as is already the case with that clunky other "payments pretender", eBay's infamous "PreyPal" …

Even if these payments middlemen make use of direct debits via the ACH system (as “PreyPal” prefers to do to more cheaply access payers’ funds), such access is not interactive—there is no immediate acceptance of the debit by the bank nor any guarantee that, the following day, the bank won’t reverse the debit due to an insufficiency of funds. The simple fact is, direct debit via ACH is not a suitable mechanism for physical point-of-sale transaction payments where the goods involved are going to immediately walk out the door (nor was the relatively primitive bank-to-bank ACH system ever intended to be used as a mechanism for non-bank middlemen to access funds for such transactions); the only safe route for a merchant for such transactions (credit or debit) is via a retail bank Credit Card Merchant Account with its interactive linking to the retail banking system …

The choice of the payment vehicle, from those offered by the merchant, is driven by the payer who directly bears none of the cost of such choice. Sensible payers have their funds stored in a licensed, prudentially regulated, financial institution; world-wide these institutions issue MasterCard/Visa credit/debit cards—and now the “digital wallet” extensions thereof—to enable depositors to easily access such funds on- and off-line. And, unlike the “pretenders”, the retail banks offer an effective and balanced transaction dispute resolution process for MasterCard/Visa transactions.

People should therefore stop kidding themselves; not Apple nor any of the other "payments pretenders" (including Bitcoin) are ever going to have a noticeable effect on the “bankcards”, MasterCard/Visa and their new “digital wallet” extensions—other than to make MasterCard and Visa even better long-term investments ...

What then about Bitcoins? Obviously, I’m missing something, but why would any buyer choose to complicate any retail transaction by paying with Bitcoins, which are effectively a volatile “foreign” currency requiring a ~2% FX conversion fee (~1% at each end)—even for a local transaction—and has no transaction dispute resolution process?—Dream on Bitcoin fanboys …

And what about eBay’s “PreyPal? Well, next time you visit The Home Depot, ask a cashier how the eBay-subsidized "Pay Here With PayPal" experiment is going—LOL ...

But, back to Apple. “… with the company being privy to payment card details of hundreds of millions of iTunes users”

With the advent of the new, professional, all-purpose “digital wallets” from both MasterCard (“MasterPass”) and Visa (“V.me”), I suspect that it is only a matter of time before such “credit card details” (ie, card numbers) will not be manually useable for making a payment (or will come with a higher discount fee, as is currently the case sometimes with “card not present” transactions), for it is the possible fraudulent use of these card details that is the real, and costly, ongoing weakness of the card system. From a security point of view, I see such card details becoming nominal only and the likes of the “MasterPass” and “V.me” digital wallets (accessed via mobile or plastic card, or online) becoming the dominant vehicle for all retail transactions—on- and off-line—with much improved efficacy and security for all stakeholders …

Regardless, finger print reading or an NFC chip only makes a smart phone a little smarter; a “payments system” it does not make. But, an NFC chip should facilitate the use of the new “MasterPass” and “V.me” digital wallet apps …

Methinks there are no long term “spoils” in retail payments for Apple or any of the other payments middleman—only for those that otherwise keep safe our surplus funds—the licensed, prudentially regulated, retail banks …

Yes, there are presently some anachronistic features of the credit card system; the operational card details imprinted on the card and recorded on the card’s primitive mag strip are serious, fraud enabling, anachronisms and, undoubtedly, those anachronism will be phased out following the implementation of the approaching mandated EMV Chip+PIN regime (where the PIN may not be required for nominal value POS transactions), and the new MasterCard/Visa digital wallet extensions thereof.

And, finally, how can anyone have a discussion about retail payments, without mentioning the two elephants that have recently entered the room, the new, professional, infinitely more secure and smooth working “digital wallets” from MasterCard (“MasterPass”) and Visa (“V.me”)? …