Seeing that Apple Pay is very likely to launch soon, I hope that Rapid KL would seriously consider adopting "Open-Loop Payment (OLP)" so that passengers could pay with Credit/Debit cards that they already own.

Understand that Rapid KL might have had a trial back in 2020 (seems to only involve our local debit network scheme, MyDebit), I sincerely hope that they would at least offer support for Visa and Mastercard (V/MC) if they ever adopt OLP as this would ensure that:
1. Apple Pay and other Mobile Wallets (Samsung / Google Wallet) users would be able to pay with their phones.
Note: Yet to see any indication that Apple Pay would launch with support for MyDebit, tho in other countries such as Australia it is possible to use dual-network cards in Apple Pay (Australia: V/MC + eftpos; in Malaysia's case: V/MC + MyDebit; Google: "Use dual-network debit cards with Apple Pay in Australia"). Don't think Samsung Wallet supports MyDebit yet as well.

2. Foreign visitors have an option to not need to go through the hassle to acquire a TnG card upon arriving.
Note: I cannot stress how smooth sailing my experience was getting onto public transport networks in London and Sydney as both transit systems have adopted OLP and would accept any Visa, Mastercard or even AmEx payment cards. Both transit systems still offer the pre-existing Closed-Loop payment scheme in addition to OLP (London: Oyster Card; Sydney: Opal Card) and passengers have the benefit of added options (my experience in Sydney: 50/50 between OLP and Opal with the younger generation preferring the former). Despite using OLP, I still get similar or exact benefits as I would be getting with Oyster/Opal cards (daily and weekly fare caps).

Based on an article I found online (Google: "Visa Reports 50 Open-Loop Launches and Strong Growth in Transactions for First Half of Fiscal Year"), 50 new OLP launches were recorded in the year ending Q1 2022 and in total >500 travel agencies currently supports Visa as a payment method. This shows that OLP is one of the key trends in public transport going into the future. A quick search seems to indicate that Rapid KL has adopted Vix Technology's fare collection system. Vix has the capability to deploy OLP given that they have deployed several elsewhere.

Some examples of OLP adoption within the transit systems (based on secondary research; just Google: "Open-Loop Transit [city name]"):
1. Singapore
2. Bangkok (potentially still in trial)
3. Hong Kong (thousands of busses; Octopus Card (HK's TnG equivalent) could be added to AP)
4. London
5. Sydney
6. New York
7. Vancouver
8. Portland
9. Brussels
10. Stockholm
11. Multiple French cities
12. Venice (Considering)
13. Barcelona (Considering)

Maybe Xavier Naxa would be interested in launching a petition on this to hopefully convince Rapid KL that there is a demand for OLP and (in relevance to this thread) so that Apple Pay users would be able to maximise this highly likely soon-to-launch feature?

Hey @engseng, here you go:
Hope these are able to clarify your doubts

It seems that all of the users (albeit just a few) who reported success in adding MY-issued cards are adding cards from the Mastercard network.

Update us if you managed to add cards from Visa (I have no luck so far yet)

Or... We can let operators (public transport, parking, etc.) know that we would want the option to pay with Visa/Mastercard and suggest that they go for Open-Loop Payments?

Ever increasing number of parking lots are implementing Visa/Mastercard payments (without surcharge mind you) in addition to TnG. Public transport (Rapid KL) is the only place left that requires me to use TnG.

Standard Chartered MY's Apple Pay Page:

www.sc.com/my/bank-with-us/apple-pay/

Yes. It seems that the banks and acquirers have done a great job in ensuring most of the payment terminals deployed are CDCVM (Consumer Device Cardholder Verification Method) enabled.

CDCVM is an alternative to PIN number (Malaysia) / Signature (in other countries) to verify the cardholder. Cardholder verification is needed to go beyond the "no-verification" threshold which is RM200 in Malaysia.

TLDR: Apple and FI partners in Malaysia seemed to have done some "magic" to make sure you are not bothered by the RM200 limit most if not all of the time.

If I am in that situation, I would have just discard my check-out items, walk out the store, and bring my patronage elsewhere.

I would not bulge and financially support a business who refuses to embrace changes.

A merchant can decide on payment methods, but so do consumers when it comes to choices of merchant.

Before discussing on the MDR charges on Apple Pay (charge amount and on who is liable), we should first understand how the card payment processing flow works during settlement:

Issuer Bank -----1----> Card Network -----2----> Acquiring Bank / Payment Service Provider -----3----> Merchant

Issuer Bank: The bank who issues the Credit / Debit Card used for payment (if I used a X Bank Credit Card to buy my coffee, the Issuer Bank for the transaction would be X Bank); Yes, the issuer bank gets paid whenever you use your card for providing the card facility in the first place. However when fraud occurs, the issuer bank may be the one who return the disputed funds out-of-pocket.
Card Network: Visa / Mastercard/ AmEx / MyDebit / etc.
Acquiring Bank / PSP: The financial institution used by the merchant to process card payments on their behalf (if the merchant contracted Y Bank to process their payments, Y Bank is most likely the one who provides the Card Terminal to them and Y Bank's info would be printed on the receipt)

*All MDR and fee percentages below are rough approximations for calculation purposes only; it is not meant to be relied on, only to make an example*
Settlement Part 1
When settlement occurs, the Issuer Bank would first deduct the Interchange fee (set by card networks typically) and pay the remaining to the Card Network.

Issuer Bank Keeps: RM100.00 * (0.5%) = RM0.50
Issuer Bank Pays: RM100.00 - RM0.50 = RM99.50

Settlement Part 2
Card Network takes a cut of the transaction as their fee (association fee etc.) and pass the remaining to the Acquiring Bank.

Card Network Keeps: RM99.50 * (0.1%) = RM0.10
Card Network Pays: RM99.50 - RM0.10 = RM99.40

Settlement Part 3
Acquiring Bank takes a cut on the mark-up for providing a service and pass it to the merchant.

Most acquiring banks quote an "all-in" Merchant Discount Rate (MDR) to the merchants and this is the only "public facing" fee. The difference between what the Acquiring Bank Receives and Pays would be the Acquiring Bank's mark-up for providing the service.

All-in MDR: RM100 * (2.0%) = RM2.00
Acquiring Bank Receives: RM99.40
Acquiring Bank Pays & Merchant Receives : RM100.00 - RM2.00 = RM98.00
Acquiring Bank Keeps: RM99.40 - RM98.00 = RM1.40


SUPPOSEDLY the issuer banks are the one who has to fork out the 0.15% (reportedly) to be paid to Apple, the idea is that payments made through Apple Pay are safer and less prone to fraud and Apple gets a cut for making that possible. This is recently in the centre of a court case in the US because some banks disagree with the amount to be paid to Apple for using Apple Pay.

In addition, with card payments, whether with a physical card or Apple Pay, it would still get charged with the same MDR by the Acquiring Bank / PSP since they are still a Visa / Mastercard transaction. If anything, participating FIs reportedly has to agree that they would absorb the fee and not push it to consumers or merchants. And this is very much reflected on Maybank's FAQ and other banks' policies.

Therefore, if the Apple Pay fees are paid by the merchants, issuer banks would not be suing isn't it?

On the experiment done by @asellus, we can see that "Apple Pay + Maybank MAE" and "Alliance Bank Visa CC + Paywave" has similar fee whereas "Maybank MAE card with Paywave" has a much lower fee. This could be because physical MAE Card payment is made through the MyDebit network where else the other 2 is processed through Visa / MC (Google: "[Card Network Name] Interchange Fee Malaysia"; Credit and Debit cards has different fees).

Therefore, I hope this explains or convinces some of you that Merchants would not be charged extra transaction-related costs for accepting Apple Pay payments. However some merchants might need to upgrade to a contactless-enabled terminal etc. which will incur costs. With that said, some merchants may not want to enable contactless payments at all for strategic reasons (Google: "Walmart Apple Pay").

Finally, I wish everyone a guilt-free and smooth experience on using Apple Pay. To say that the amount of convenience of having Apple Pay has changed my life in the past few years would be an understatement and I am just glad that I could enjoy the same convenience now even in Malaysia.

TLDR: Merchants do not pay more transaction fee to accept Apple Pay. However other upfront fees may apply (change of card terminal). Merchants may not want to accept Apple Pay for other reasons as well.

*Everything is a gross simplification, please do not rely on this post, it is meant to give a very high-level understanding*

Further to what @KaiHD has mentioned, in Australia, merchants are LEGALLY ALLOWED to pass card payment-related charges (MDR, terminal rental etc) to consumers if they choose to (normally between 1.0%-2.0%).

Locally in Australia, there is a locally operated Card Network like MyDebit called "eftpos". Generally, there are 3 types of merchants that I have met:
1. Don't charge surcharge at all (typically larger companies who can stomach the fees).
2. Discriminate between Visa/MC and eftpos, with the latter not being charged a fee (like Aldi and some restaurants).
3. Charge surcharge when you use *whichever* card for payment.

Initially when Apple Pay launched in Australia many years back, only Visa/MC/AmEx is supported. eftpos was a relatively new addition to Apple Pay (Google: "Apple Pay Australia eftpos support").

Since the merchant can legally pass card charges to consumers so long that they indicate upfront, consumers can choose which payment method to use (Cash, eftpos or Visa/MC).

Hopefully one day MyDebit would be supported in Apple Pay; could be a very long shot. However the good news is that PayNet (operator of MyDebit) has gotten approval for Token Service Provider from the EMVCo.

*It surprised me that Aussies don't mind the 1-2% charge for convenience even if the merchant offer 0% charge for eftpos. All it takes is for the user to pick eftpos and reauthenticate with Face ID*

MyDebit and Visa/Mastercard are separate networks. MyDebit is Malaysia's local debit card network scheme, similar to that of eftpos (Australia).

Given that MyDebit has relatively lower acceptance rate outside of Malaysia, banks in Malaysia issues Debit Cards with both Visa/Mastercard and MyDebit [Google: "Dual-Network Payment Cards"]. This is to hopefully offer lower acceptance cost for merchants (MyDebit has slightly lower interchange fee as compared to Visa/MC Debit for low-value transactions) and to ensure cardholders could use the debit cards overseas as well.

An implementation of dual-network card in Apple Pay example is as follows:

Hey SkyHermit, I came across an article by Ata Distance (@Kanjo on Twitter) a couple months back on the mobile payment landscape in Japan which may be related to your situation (Google: "site:atadistance.net "Don’t say Apple Pay: what to say at checkout in Japan with Apple Pay"" and "site:atadistance.net "Apple Pay Japan Card Guide"").

The gist is that there's several key differences between contactless payment in Japan and elsewhere. Some of the key points mentioned in the articles are (I am paraphrasing them):
1. Japan uses FeliCa standard (NFC-F) predominantly for NFC where else EMV Contactless (Visa / Mastercard) uses NFC-A or NFC-B. The article states that Japan-issued Visa and Mastercard typically has a FeliCa network partner (e.g. iD and QUICPay).

2. Use the term "Credit" or "Touch" when you want to use overseas EMV-based cards (which is literally most of the world, Malaysia included).

3. The EMV Contactless logo do not mean that the store supports EMV Contactless payments, rather rely on the acceptance marks for Visa / Mastercard contactless [see attached photo].

Hope these helps!

So far I have used the following without any issues:
MY Cards in AU
UK Cards in MY & EU

I believe so long the merchant's terminal supports EMV Visa and Mastercard network, things should go fine.

Some countries that I imagine could be a bit more challenging in terms of general EMV Visa / Mastercard acceptance would be:
1. China (mostly UnionPay, and most of the consumers prefer QR > Card Payments)
2. Russia (due to current sanctions)
3. Japan (on the contactless side, due to the differences in NFC technology used by FeliCa and EMV)
4. Some EU countries (Netherlands where some merchants would only accept Maestro, which is mainly issued in EU only, but I remember reading that there's a timeline to migrate them over to accept Mastercard Debit)

The above are purely based on my understanding and I don't work anywhere near the payments industry

Given that pauper21 has a tap Transit Card (TnG Card in Los Angeles) in his wallet, the HSBC card could be one issued by HSBC USA which supports Apple Pay.

In any case, HSBC cards issued by HSBC in SG, HK, AU, UK and many more countries supports Apple Pay.

Kinda surprised that HSBC MY did not participate in the Apple Pay launch in Malaysia when they already support this feature in many other countries they currently operate in.

Hey knowledgable members of this forum,

Curious if there is any rumour floating around among your circle in regards to a new batch of financial institutions that will the Apple Pay feature in the near future? Especially for the foreign banks which has already supported Apple Pay elsewhere for e.g. HSBC, OCBC & UOB.

I guess the forum would be interested to know if you are able to share the info without compromising your ownself. Thanks in advance!

Just a quick addition, it doesn't seemed to work for AMEX card currently.

In my experience, it crashes right away after pressing on the "Add to Apple Pay" button.

Purchases above RM200 relies on a Verification Method called CDCVM to avoid transaction rejection / having to type in pin. However in order for CDCVM to work, everything in the chain (from your devide to merchant's terminal to merchant's acquirer, basically all the way out) has to support the CDCVM flag.

In this circumstance, it could be that potentially the CDCVM flag was not recognised. On the other hand, the merchant / merchant's acquirer or even your card issuer could also restrict high-value transactions for fraud prevention purposes.

Oh yeah forgot to mention this. Both Apple Pay & Google Pay supports CDCVM by leveraging on-device authentication (fingerprint / facial recognition), of which if you pass the authentication they will send the CDCVM flag (to inform that the device has authenticated the cardholder) alongside the other payment information when you tap your device on the NFC reader.

The CDCVM flag will be IGNORED if the terminal is not configured to pick up on the flag.

As for the "physical card", I am not sure if you meant Chip & PIN or NFC & PIN. But from what I understand not all terminals support NFC & PIN, which those who do not support will require the cardholder to go through Chip & PIN method.

Otherwise, it could be either the merchant's bank's or your card issuer's decision to disallow contactless payment over a certain limit to limit their fraud-related exposure.

I have encountered multiple read errors with the PAX A920 terminals with Visa Cards. Did not try with Mastercard.

Also, Shopee’s Apple Pay payment method seemed unusable for me as well. Straight to Payment Failed whenever I chose Apple Pay for checkout.

Is anyone facing the same?

Yes, setting up Apple Pay DOES NOT replace your physical card. Therefore your physical card should still work after setting up Apple Pay.

Happy to inform that Apple Pay on Shopee has started working for me again.

Successfully paid for a purchase with an AMEX card.