Department-store chain J.C. Penney Co. Inc. confirmed over the weekend that it no longer accepts Apple Inc.’s Apple Pay mobile-payment service. The move appears to involve a Visa Inc. contactless rule that took effect this month that may have broader implications for U.S. retailers.
The confirmation came in a tweet on the Ask JCPenney Twitter feed, where a consumer inquired after his wife tried to pay for a purchase with Apple Pay but was told the service no longer was accepted. The consumer wondered “why would you remove a very secure form of payment? Do you not care about your customers [sic] security?”
JCPenney’s reply divulged no reason for unplugging Apple Pay. “JCPenney made the decision to remove Apple Pay from our stores, we apologize for any inconvenience this may have caused,” the tweet says. “We will definitely forward your feedback regarding this for review.”
In an emailed statement to Digital Transactions News, however, JCPenney said the change involves new requirements regarding EMV contactless payments. Without mentioning Visa by name, the statement references requirements Visa announced in October 2017 that took effect 18 months later.
“A third-party credit card brand made the requirement for all merchants to actively support EMV contactless functionality effective April 13, retiring the legacy MSD [magnetic-stripe data] contactless technology in place. Given the resources and lead time associated with meeting the new mandate, JCPenney chose to suspend all contactless payment options until a later date. Customers still have the ability to complete their transactions manually by inserting or swiping their physical credit cards at our point-of-sale terminals in stores, an option employed by the vast majority of JCPenney shoppers.”
Plano, Texas-based JCPenney, which has been closing stores in the face of weak sales, began accepting Apple Pay chainwide in July 2017 after testing. The company made its private-label card and cobranded Mastercard, both issued by Synchrony Financial, eligible for rewards points if they funded Apple Pay purchases.
In addition to dropping Apple Pay in its stores, JCPenney also is turning off the service in its mobile app, according to the 9to5Mac news blog.
A spokesperson for Cupertino, Calif.-based Apple declined comment.