The next time you're out shopping, don't be surprised if you see the person checking out in front of you using their iPhone to pay instead of a credit card.

Apple's (AAPL -1.04%) payment service, Apple Pay, saw a 52% year-over-year increase in adoption during November, according to data from Salesforce cited by Deutsche Bank analyst Bryan Keane. That was across both in-store proximity payments and online payments made through Apple devices.

That's bad news for PayPal Holdings (PYPL 1.35%) and other, more established, digital wallet services. Apple is rapidly taking market share, and its fintech aspirations could stymie the growth of its rivals.

Taking over payments

The data show a surprising story for Apple Pay adoption.

While the number of Apple Pay users was soaring, usage of PayPal and regular credit cards declined in November. While both of those methods have much larger user bases than Apple Pay for online and in-store transactions, respectively, this result signals that users are dropping older payment methods in favor of Apple Pay.

That said, PayPal is still the one to beat in online payments. Consumers used it for 16% of all e-commerce purchases. Apple Pay is far behind, used for just 5% of purchases.

PayPal has been rapidly expanding the functionality of its services over the last few years. It revealed a redesigned app and has focused on making its services ecosystem the center of its users' financial lives. On top of its core online payments service, it offers everything from cash management to bill payments to investing. All of this is designed to increase transactions per account.

To PayPal's credit, management says it's gaining share in e-commerce. However, in-store payments remain a bigger challenge for PayPal, which shifted from using QR codes to issuing physical debit cards for PayPal and Venmo. As consumers shift back to in-store purchases, that may drag on PayPal's results despite its efforts over the last two years to increase utility.

Apple's ability to make greater headway is currently limited due to Apple Pay remaining exclusive to Apple devices. But there's lots of room for Apple to expand.

Apple Financing

Apple pushed deeper into the financial services business recently, and that could become the next big growth driver for the company's services segment.

When Apple launched its "buy now, pay later" service this summer, it took another major step toward becoming a financial services company. Instead of outsourcing the lending and servicing of those point-of-sale loans to a third party, Apple is handling them in-house through a subsidiary, Apple Financing.

With the capability of running credit checks, making lending decisions, and servicing financial products in-house, Apple could become a full-fledged fintech company a la PayPal. With in-house capabilities, Apple can more easily expand its financial services globally without having to find and negotiate with local partners in every market it wants to enter. And the growing adoption of Apple Pay, as well as the expansion of the services offered in Apple's digital wallet, pose significant threats to the leading player in the space.

As the focus for Apple investors remains its device sales (particularly the iPhone), efforts like Apple Pay may not immediately get the recognition they are due. But the services segment remains a major source of profit growth for Apple, and fintech could be the next big industry it tackles. Considering PayPal is an $80 billion company unto itself, that's nothing for Apple investors to sneeze at.