Rite Aid, CVS disable Apple Pay technology

When Apple Pay was announced at a highly choreographed launch event in September, analysts declared that the mobile payment system had a shot at doing what other digital wallets have so far failed to do: Dethrone plastic credit and debit cards as shoppers' default way of making a purchase.

But now, less than a week after the system's launch, Rite Aid and CVS have disabled their Apple Pay technology, a sign that the tech titan's quest to make its digital wallet ubiquitous may be more difficult than many thought.

The drugstore chains have not said why they have shut down this technology. CVS simply "cannot accept Apple Pay" or other mobile payment options that rely on similar technology, the company said. Both companies said they are evaluating various mobile payment technologies.

Analysts say the moves are likely a pre-emptive strike against Apple Pay by the two chain stores, which are part of a coalition of retailers building their own mobile payment offering. The group includes stores such as Wal-Mart, Best Buy, Lowe's, and Dunkin' Donuts. Its offering, dubbed CurrentC, is slated to roll out in 2015 at 110,000 locations.

CurrentC would have some advantages over Apple Pay for retailers. It will draw money directly from a consumer's bank account instead of charging a credit card like Apple Pay does. This would allow retailers to avoid paying credit card companies what are known as swipe fees every time a customer pays with a credit card. CurrentC would also give retailers access to more data about shoppers.

Washington Post