Top Stories

Apple jumps on mobile-payment bandwagon

MOBILE WALLET? The new iPhone is said to have a Near Field Communication chip and Touch ID for mobile payments.


    Sep 02, 2014

    Apple jumps on mobile-payment bandwagon


    APPLE plans to turn its next iPhone into a mobile wallet through a partnership with major payment networks, banks and retailers, according to a person familiar with the situation.

    The agreement includes Visa, MasterCard and American Express, and will be unveiled on Sept 9 along with the next iPhone, said the source, who asked not to be identified because the talks are private.

    The new iPhone will make mobile payment easier by including a Near Field Communication chip for the first time, the source said.

    That advancement, along with Touch ID, a fingerprint-recognition reader that debuted on the iPhone 5s, will enable consumers to securely pay for items in a store with the touch of a finger.

    While companies including Google have invested in creating ways for phones to make payments in a physical store, American retailers have been slow to adopt the technology, thus limiting its use by shoppers, according to Ben Bajarin, an analyst for Creative Strategies in San Jose, California. That could change with Apple entering the market because iPhones have the largest market share in the United States, he said.

    "Love it or hate it, Apple drives a lot of standards in the industry," Mr Bajarin said in an interview.

    "They are the mover in these markets. When they do something, the industry seems to follow."

    Trudy Muller, a spokesman for Cupertino, California-based Apple, declined to comment, as did Jim Issokson, a spokesman for MasterCard. Representatives for Visa and American Express did not immediately respond to requests for comment.

    Re/code earlier reported that Apple had reached an agreement with American Express on the payments plan, citing sources familiar with the talks.

    For Apple, the push to create a mobile wallet is to keep users within its ecosystem, thus creating more loyalty to its brand and buying of its products, Mr Bajarin explained.

    "It's about retention, solving and adding features that keep your base engaged and keeping them loyal," he said.