CVS/Rite Aid Block Apple Pay – New Loyalty Program?

Last week I wrote about Apple Pay for travel. While it was a general failure for travel, I was pleased to say it worked very well at domestic merchants like McDonald’s and Starbucks. I can also add the drugstore chain Walgreens to the positive list.

Speaking of drugstores, Walgreens competitors CVS and Rite Aid decided they don’t want Apple Pay. No specific reason was given but this article notes that both companies are supporting a rival system known as Merchants Customer Exchange (MCX).

Visiting the MCX website may offer some clues why they are dumping Apple Pay. MCX is a merchant-owned checkout system. In other words, these companies see it as a way to avoid paying fees to Apple and others. The MCX system is actually going to be a downloadable app called CurrentC, available for both Apple and Android. According to the website, it is currently in private testing but is expected to be available to the public next year. No specific date is available.

Like Apple Pay and Google Wallet, this will be a cloud-based system using tokens but they don’t say what kind. They also claim CurrentC will automatically apply all merchant coupons and promotions. One interesting tidbit: MCX’s members operate about 110,000 locations. Apple Pay is already in place – or near ready – at more than double that number.

At least there is possibly something for points junkies. The website says that users can “earn participating merchant loyalty rewards.” However, there is nothing to download yet and there is no explanation of just what kind of program they will be offering. Personally I don’t have high hopes for these loyalty rewards, thinking instead they might be merchant-based like Best Buy’s rewards program or perhaps something offered by a grocery store chain. However, I will keep my eyes open.

Really, it is fine by me if someone prefers the MCX method. However, it sails outside over my head why these giant drug retailers are completely throwing Apple Pay and Google Wallet customers under the bus. CVS and Rite Aid are losing out on all this potential existing business, instead relying on a future untested system. I guess time will tell if they are making the right decision.