Apple Pay – Seamless iOS App Purchases & NFC Payments

The second part of this morning’s keynote was a snoozefest about credit cards called Apple Pay. Like the rumours suggested, Apple hammered out an agreement with Visa, Mastercard, American Express and a bunch of stores to effectively, bring Paywave/Paypass to Americans and to make paying for stuff within iOS apps seamless.

You start by taking a photo of the front of the card and if the card is from a bank Apple partners with, it’s verified and added to Passbook. If you’ve got multiple credit cards, you can chuck em all in here. It seems that to use Apple Pay the bank the card is issued from has to work with Apple to integrate it into Apple Pay(e.g: using a Visa from Westpac would need Westpac to hook up with Apple to make Apple Pay work).

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For in person use of Apple Pay you tap your iPhone 6 (which has NFC now!) or Apple Watch on the NFC enabled POS device and verify you are the owner of the card using the Touch ID sensor on the iPhone. I don’t quite know how using the Apple Watch to pay does the 2nd level of authentication as it doesn’t have Touch ID. It would suck if you needed to pull your phone out when paying with the Apple Watch.

Here’s a demo from the keynote of Apple Pay in action:

iOS apps can also use Apple Pay to take payment for stuff without making the user enter in all their card info. Developers can insert an Apple Pay button into their app using a service like Stripe (which already has support for Apple Pay) and users just tap the Apple Pay button then authenticate with Touch ID. That’s it. Tap the button, hold finger on sensor, money is sent. Frictionless payments! It’ll never be easier to blow your wad on impulse buys.

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All the technical detail on implementing Apple Pay within iOS apps is on the Apple website, with no developer registration required. There’s not much in terms of detail about the in-person transactions as that’s really none of our business – that’s all between the banks and Apple.

The bad news is that there’s nothing announced for countries outside the USA. Probably because contactless payments are pretty common, if not the standard, elsewhere – this isn’t that mindblowing for those of us who stopped swiping cards and signing for stuff years ago. Apple is working on rolling it out worldwide. I assume that Australia, as a first world country, with some of the most profitable banks and high credit card take up, would be sooner rather than later.

From a personal point of view, this is by far the best implementation of a wallet style thing on a mobile. Those dinky NFC stickers are laughable now. If Apple and Australian banks get their act together and considering all our terminals are NFC enabled anyways, there’s no reason why I can’t ditch my wallet entirely and just use an iPhone/Apple Watch combo. NAB already has ATMs that let you take out cash quickly using NFC so there’s no need to carry a card for that either once they become more widespread.

I’m also not sure using Apple Pay in person requires mobile data use. From the videos it all looks too fast to be using data, but it could just be a super fast network that Apple has set up in the demo area of the keynote theatre. It’s very possible that data isn’t required, as the POS terminal would have it’s own internet connection to handle the transaction – using Web Pay seems to let the iPhone or Apple Watch emulate a card.

Apple Pay was probably the most boring announcement of the day – financial transactions aren’t the most interesting things – but its impact on how we buy stuff and on Apple’s bottom line could be huge. It also makes the iOS platform even stickier. One more pain point for people trying to move from iOS to Android.

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Reckoner had its humble beginnings way back in June of 2013.

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