Apple Announces What Could Be A Venmo Killer: Will It Compete? - PayPal Holdings (NASDAQ:PYPL), Apple (NASDAQ:AAPL)

Apple Inc. AAPL announced its latest payment feature, which will make the tech behemoth a major competitor in the growing peer-to-peer payments industry.

The feature will enable Apple to compete head to head against the industry’s most dominant player, Venmo (acquired by Braintree, which was then in turn acquired by PayPal Holding Inc PYPL).

Venmo Vs. Apple Pay: A Head-To-Head Battle

Convenience

Venmo: Venmo is the most widely used P2P app (processed over $17 billion in payments in 2016) and is available to both iPhone and Android users. The service, which users can sign up to by linking either a credit or debit card to their account, allows an individual to send a payment simply by typing the amount of money you are requesting or paying to a username and clicking send. Another convenient feature is Venmo’s newsfeed, which records payment history and provides a feed of your friends’ transactions. So, if you’re wondering whether you paid back Patrick for dinner, check out the news feed.

Apple Pay: Apple’s payment service, which will be debuted in iOS11 this fall, will allow iPhone users to send money to their contacts through iMessage. A user will now see an Apple Pay icon at the bottom of their keyboard, which he or she will be able to click and then type in how much money he or she wants to send. Unlike Venmo, Android users will not be able to use this service. The money from the transaction will go into the user’s Apple Pay account, which only 15 percent of Apple users even use, according to pymnts.com.

Winner: Venmo’s universal accessibility for both Android and iPhone users and its social-media-esque newsfeed gives it the upper-edge.

Fees

Venmo: Venmo transactions are free if a user links its debit card or bank account to its account. If a user chooses to use a credit card, Venmo charges a 3 percent fee.

Apple Pay: Apple does not charge any fees.

Winner: Apple Pay. You cannot beat free.

Security

While the mobile payment industry is not 100 percent safe, both Venmo and Apple Pay are compliant with the Payment Card Industry Data Security Standard Level 1 form. This is the same security standard used by all major credit card companies. This means both services use bank-level security and data encryption to protects its clients.

Both services should be almost as safe as using a credit or debit card at a store.

Overall Winner: Venmo

While Apple Pay might attract some of Venmo’s users, it is hard seeing them competing with the current industry leader, Venmo. Currently, most Venmo users are able to avoid fees by linking their account to their debit card, and it is extremely valuable that the system can be used by both Apple and Android users. A PayPal spokesman told Fortune he was not even alarmed by the announcement of Apple’s new P2P feature, "As the world’s leading open digital payments platform, we welcome any developments that help people move away from the awkwardness of cash."

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Everything You Need To Know From Apple's Worldwide Developers Conference 2017 Keynote Address Time To Cash In On Venmo? ______ Image Credit: Compiled from 1) By Originally Venmo, derivative work by User:ContinueWithCaution (Venmo) [Public domain], via Wikimedia Commons and 2)Original logo by Apple Inc. [Public domain], via Wikimedia Commons

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