Apple Pay hits a snag despite successful roll-out

Legalbrief reports that the system already totes up more transactions than all other 'contactless' payment methods combined. Industry experts say it stands a chance of becoming the first widely used payments feature on smartphones. The new system allows consumers to buy items at more than 220 000 stores or inside apps using the latest iPhones and a thumbprint. The Wall Street Journal reports that Apple has signed up the six biggest credit-card issuers, accounting for roughly 83% of credit-card transactions in the country with 500 financial institutions expected to join by early next year. It also has the three major credit-card networks: Visa, MasterCard and American Express, according to the report. However, it notes the first setback came with separate announcements by CVS - the 12th largest company in the world - and Rite Aid that they have stopped accepting the payment system across the country. By disabling the Near Field Communications (NFC) chip readers in all their credit card terminals, the companies have turned off their customers' ability to use both Apple Pay and Google Wallet. According to a PCWorld report, Rite Aid's company's customer service department confirmed the 'tap-and-go' payment systems were not currently welcome. 'We just can't take it at this time,' a representative said when asked for details. The report says it's also unclear if the retailer has disabled all NFC payment ability on its terminals, thus also rejecting debit and credit cards with built-in NFC chips, or if it is actively identifying and blocking just those payments made with Apple and Google systems. Full report in The Wall Street Journal Full PCWorld report

Apple CEO Tim Cook fired back at both companies on Monday, saying there were many other retailers around the world to sign up. According to a report on the Fin24.com site, Cook said: 'We've got a lot more merchants to sign up, we've got a lot of banks to sign up and we've got the rest of the world.' The report notes he argued that Apple Pay offered better security and privacy than competing services, and that retailers risked alienating customers by limiting choices at checkout. Full report on the Fin24.com site

A report on the qz.com site says Cooke and Alibaba founder Jack Ma are considering teaming up to tackle China's multitrillion-dollar financial payments sector. But any combination of the two tech giants could put them on dangerous ground with Beijing which has been fighting to protect the turf of its state-owned payment giant, and is already cracking down on both companies, the report notes. Ma said he would be 'very interested' in partnering with the Apple Pay platform. 'We're going to talk about getting married later this week,' Cook replied, offering high praise for an Alibaba team that was 'wicked smart', according to the report. The appeal of China's e-payments sector is obvious for both companies. After all, states the report, online third-party payments there are expected to total 3.8trn this year, a 35% increase from 2013. While growth is slowing slightly, the report says the industry is still expected to expand by more than 25% a year until 2017. Full report on the qz.com site

And security issues have been raised following the latest cyber-attack on American retailers and restaurants. Both Kmart and Dairy Queen said their computer systems were compromised in security intrusions involving customers' credit and debit card information. The New York Times reports that Kmart said that it appeared to have been attacked in early September and that malware was present on some of its in-store payment systems. The malware, like the type found at Home Depot recently, was meant to evade antivirus systems, according to the report. It notes the company did not indicate how many stores were affected or how many credit cards were potentially compromised but said the malware had been removed. Dairy Queen also confirmed that its in-store payment systems contained malware, the report states. Full report in The New York Times