Apple wants to replace your wallet and kill your credit cards. “As it turns out, most people that have worked on this have started by focusing on a business model that was centered on their own self-interest instead of focusing on the user experience,” Tim Cook said, throwing some magnificent shade at Google and other mobile payment processors.
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Apple Pay comes with something called SecureElement, which isn’t new (it’s been around for three years), but here’s how it works:
Apple’s weird reticence regarding NFC means it is now years behind Android, but because NFC-based mobile payments still haven’t caught on in a big way, it has a chance to catch up… and Apple’s covering that gap with all the partnerships it could wrangle. McDonalds will take Apple Pay in its drive-thrus. Whole Foods will take it for organic quinoa. Apple has deals lined up with other US retailers, including Walgreens and Duane Read. Apple has also teamed up with Mastercard, Visa, American Express and a wide variety of other banks, retailers and e-commerce leaders like Groupon.
The iPhone 6, unlike its predecessors, comes with NFC, reversing Apple’s habit of releasing phones without near-field communication and brings the iPhone up to speed with just about every other premium smartphone.
NFC is new to the iPhone, but it’s far from a novel technology. NFC lets two nearby devices to connect with each other, and Google has been all over it for years, pushing (somewhat unsuccessfully) to make it take off as a payment platform. Apple has been accumulating a roster of NFC and mobile payment-related patents as far back as 2009, but up until now, it hasn’t embraced it.
And since Apple already has over 800 million credit cards on file thanks to iTunes, it won’t even need to pester everyone for their banking information.
Apple says it’s currently “working hard” bring Apple Pay to other countries, but it’s only available in the US for now.