Kroger, the nation's largest independent supermarket chain, is quietly ending its long boycott of Apple Pay and other contactless payments in hundreds of its stores.
The Cincinnati-based chain, which operates about 2,800 supermarkets under various brand names, has begun accepting contactless payments at stores in Ohio, Kentucky, California, Colorado and Wyoming, according to
The move marks a break with Walmart, Home Depot and Lowe's, the remaining few national retailers that refuse to accept contactless cards or either of the two major digital wallets, Apple Pay or Google Pay.
Kroger officials were not available to comment on the company's decision, but the shift comes after Kroger conducted a pilot in 2020 of contactless payment aceptance at its 61-store QFC chain in Washington.
One of the drivers of contactless payment adoption in the U.S. was the launch of Apple Pay in October 2014. At the time, some merchants objected to adding the new approach because of concerns about paying higher fees to Apple for in-store transactions.
Kroger reacted by joining Walmart and the two largest big-box hardware stores in a coalition called
While Walmart, Home Depot and Lowe's continue to block contactless payment acceptance, analysts speculate that the pandemic's effect on tap-to-pay methods ultimately forced Kroger to yield to the popularity of contactless payments. After years of failing to get traction,
Major card issuers, which had slowly been expanding issuance of contactless-enabled payment cards, then stepped up the pace as demand for contactless checkout rose.
The pandemic permanently shifted consumer behavior to favor contactless payments, said Thad Peterson, a strategic advisor with Aite-Noverica.
"Consumers were worried about physical contact with a POS terminal and contactless cards eliminated that problem. Post-pandemic, a lot of that contactless behavior stuck and contactless volume is climbing in the U.S," he said.
It's likely that Kroger is responding to consumer demand, according to Peterson.
"With Kroger starting to accept contactless payments, it's more likely that holdouts like Lowe's and The Home Depot may follow suit, but Walmart is likely to remain an outlier," Peterson said.
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