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TD Bank launched Apple Pay, which allows consumers to make purchases using a mobile phone, in mid-December.
TD Bank launched Apple Pay, which allows consumers to make purchases using a mobile phone, in mid-December.

Eager to cater to tech-savvy customers and hoping to shrug off their Luddite past, Massachusetts banks are rushing to embrace the new Apple Pay electronic payment system.

Hundreds of banks, in Massachusetts and nationwide, are frantically working with technology vendors and Apple Inc. to offer consumers the new electronic payment system, which securely stores their debit and credit information on the newest iPhone models.

TD Bank launched Apple Pay in mid-December. Digital Federal Credit Union expects to have it available to customers in the first quarter of this year, and Eastern Bank, Reading Co-operative Bank, and Citizens Bank are seeking to be enrolled in the service soon.


“You frankly don’t want to be left behind,” said Paul Gentile, president of the Massachusetts Credit Union League Inc. “You want to be where your members are.”

Financial institutions are also trying to avoid some of the missteps they made during the early days of mobile banking.

Some banks were slow to realize how quickly consumers would begin using phones to check their accounts, pay bills, and deposit checks. Banks that delayed adopting technology that allowed checks to be deposited by taking photos of them on mobile phones soon had to deal with frustrated customers complaining on social media.

Banks “are not wanting to miss the boat on this,” said Ed O’Brien, a director at Mercator Advisory Group, a Maynard research firm. “I think banks, and even small banks, by 2016 need to have something.”

That’s especially true for those banks that are trying to appeal to millennials, or adults in their 20s and 30s, O’Brien said.

About 40 banks and credit unions have signed on to Apple Pay since it was rolled out in September. Another 500-plus financial institutions are preparing to do so, according to Visa. Mastercard said it has hundreds of banks awaiting approval, and that the list is growing.


Banks must ensure that Apple, card issuers such as Visa and Mastercard, and technology providers are all on board before offering the mobile payment service. But because banks control the debit and credit card accounts, they are the gateway and need to be enrolled in Apple Pay before any consumer can use the service.

Apple Pay allows consumers to make purchases at participating merchants, including Whole Foods, McDonald’s, and Office Depot, by using a mobile phone. Their bank credit and debit cards are loaded onto the phone.

Initially, Apple unveiled the payment technology with a handful of national banks as partners, including Bank of America.

Last week, Bank of America noted that 800,000 customers had loaded their credit and debit cards onto Apple Pay — still a small percentage of the bank’s nearly 16.5 million mobile banking users.

But many banks and analysts are expecting mobile payments to become popular very quickly.

“For the size and scale of who can use it today, it’s exceeding other technology,” said Ryan Bailey, executive vice president of deposits and payments at TD Bank.

Consumers are taking to Apple Pay technology faster than they initially did to ATMs, Bailey said.

That’s why many banks have been willing to pay Apple the fee of one-half cent on each debit transaction.

Banks and retailers are jumping on the Apple Pay bandwagon, but many say they are open to participating in Google Wallet and other payment progams.


Walmart and other retailers, for example, are building their own mobile payments solution.

Credit unions across the country, including DCU of Marlborough, are working on their own payment platform, called CUWallet, which they plan to market to customers and merchants.

“It’s about staying relevant,” said John LaHair, a spokesman for Digital. “You’ve got to have something for everybody.”

Deirdre Fernandes can be reached at deirdre.fernandes@globe.com. Follow her on Twitter @fernandesglobe.