Ready to understand the key differences between the two dominant digital payment platforms? You‘ve come to the right place. By the end of this comprehensive yet readable comparison, you‘ll have the insider knowledge to decide when Apple Pay or PayPal is better suited for your needs.
First, let‘s briefly cover what each is and does…
Apple Pay is the mobile payment system designed specifically for Apple devices like iPhones, iPads and Apple Watches. It uses near field communication (NFC) technology and tokenization to facilitate both in-store and in-app payments securely.
PayPal operates across platforms as a digital wallet, processing peer-to-peer transactions and payments for online stores. Users can link bank accounts and cards to send money and pay, with PayPal acting as an intermediary.
Now, let‘s dig deeper into the key differences and use cases. We‘ll look at factors like security, fees, versatility, and recent evolutions.
Accessibility and Platform Support
Apple Pay is confined exclusively to Apple devices and software. As per Statista, Apple holds a 57% market share in the US for smartphones. So while Apple Pay misses out on Android users, it still has potential access to a majority of American smartphone consumers.
PayPal can be used across any device, operating system or platform as long as you have an internet connection and email address. This gives PayPal an advantage in versatility and inclusiveness. As of 2022, PayPal had 447 million registered users according to BusinessofApps.
Ease of Use
For Apple device owners, Apple Pay couldn‘t be simpler to set up and use for payments. Just add your cards to the Wallet app and authenticate with Face ID, Touch ID or passcode when paying. PayPal requires creating an account with login details and adding funding sources before transacting.
However if we look beyond 1-click payments, PayPal offers convenient invoicing, peer-to-peer transfers, and money management tools in one place. Apple Wallet is purely for payments. So PayPal provides a more all-in-one finance experience, albeit with slightly more friction upfront.
Security and Fraud Protection
Security experts consistently praise Apple Pay‘s use of tokenization as best-in-class for preventing fraud and protecting cards from unauthorized access. PayPal also uses encryption but transactions still involve passing your financial information to merchants and other users.
According to an ABA Banking Journal report, both platforms have below 1% fraud rates on par with that of physical credit cards. However, Apple‘s more seamless device-based system gives it an edge for privacy. PayPal‘s two-decade experience battling fraud does provide assurance though.
Fees and Fine Print
Apple Pay itself is free to use, but some banks or credit card providers may charge fees on each transaction similar to physical card use – usually a small percentage or flat rate. PayPal charges merchants transaction fees and may impose currency conversion fees. For friends and family transactions, it‘s free in many countries.
Both Apple Pay and PayPal‘s "Pay in 4" installments programs let you split eligible purchases into 4 interest-free payments. This can help consumers afford large purchases without taking on debt.
One of PayPal‘s advantages is that it supports over 100 currencies and facilitates transactions across different countries. This flexibility makes it the go-to for many individuals and businesses dealing internationally.
Apple Pay has more limited currency support, depending on the country and bank partners available. It also lacks the seamless currency conversion offered by PayPal.
In the past few years, Apple and PayPal have moved beyond just transactions:
Apple launched the Apple Card credit card in 2019, linking with Apple Pay to offer up to 3% cashback on Apple purchases.
PayPal‘s cryptocurrency trading integration in 2020 gave users a simpler way to buy, sell and hold Bitcoin, Ethereum, Bitcoin Cash and Litecoin.
PayPal‘s 2021 acquisition of Japanese buy now, pay later company Paidy illustrates a push towards installment financing in different global markets.
Which Should You Use?
For peer-to-peer transactions, freelancer payments, and international money transfers, PayPal is likely the best fit thanks to currency support and being platform-agnostic.
Apple device owners will appreciate the smooth experience of Apple Pay for in-store shopping and when making payments in iOS apps. It‘s seamlessly embedded across the Apple ecosystem.
Ultimately, the two services excel in different scenarios. Having both Apple Pay for streamlined payments and PayPal for financial management provides the optimal flexibility. But assess your specific payment needs and priorities to decide if one is better suited.
Hope this overview helped illuminate what makes Apple Pay and PayPal unique. Let me know if you have any other questions!