The news: Discover is sunsetting Pay with Rewards and Connected Account features in Apple Pay, per 9to5Mac. 

Both perks will end on June 4. Formerly, Discover cardholders could use rewards to cover an Apple Pay purchase and see recent transactions within their Apple Wallet.

Synchrony and issuers that partner with Fiserv will still offer both functions, per Apple Insider.

How we got here: Both issuers and mobile wallets have raced to integrate useful features to cement habit-building behaviors for long-term loyalty.

• Synchrony integrated buy now, pay later (BNPL) features within Apple Pay.
• Both Google Wallet and Apple Wallet now include travel, transit, and digital ID integrations.
• And BNPL providers like Klarna and Affirm have notched partnerships with Apple Pay to gain more in-store share for their installment products.

Why this matters: Discover is rolling back wallet integrations during a time when most payment players are trying to add features and digital wallet utility—especially as digital wallet share increases at checkout. 

• Digital wallets are now the dominant payment method for US ecommerce at 40%—outpacing credit cards by 8 percentage points, per Global Payments Report 2026.
• Payment providers that want to capture younger consumers need to tackle digital wallets: 39% of 18- to 25-year-olds and 41% of 35- to 41-year-olds cite digital wallets as their most used online checkout method.

Discover’s rollback may be related to its merger with Capital One, rather than a strategy about face. Capital One has already started moving its credit cards onto Discover; Capital One may try to renegotiate a deal for similar functionality across its whole card portfolio after unifying both portfolios. 

Implications for payment providers: Mobile wallets are the future of payments. 

By 2029, 76.5% of all US smartphone users will use mobile wallets, per our forecast. 

As mobile wallets approach market saturation, features like tap-to-pay, stored credentials, and one-click checkout will become table stakes for US users. Extra wallet tie-ins like loyalty programs, subscription management, deals, and offers will become the new growth engines.