Apple Pay makes payments quick and convenient.
Why it reall y does transform mobile payments
We're so used to hearing that the latest Apple product or service launch "transforms" its category, and we aren't necessarily referring to the language used in the Cupertino firm's own press releases - the wider media are more than good enough themselves at that particular hyperbole. It would be easy to think that Apple's latest innovation - Apple Pay - surely can't live up to the hype of doing the same for mobile payments. However, if you did, you'd be wrong.
Sure, a lot of bold claims have been made for a solution that is supposed to make mobile payments easier and quicker than ever. Apple itself has described the service as "a new category of service that will transform mobile payments with an easy, secure and private way to pay", while the Wall Street Journal has said that it "changes the way we look at our phones, not to mention wallets full of credit cards and bits of paper."
The essential details of Apple Pay
So, what actually is Apple Pay, beyond the obvious? Well, there are three elements that make up this ambitious payment system - a near field communication (NFC) antenna, a dedicated chip that Apple refers to as the Secure Element and the by-now familiar Touch ID fingerprint authentication technology that debuted on last year's iPhone 5s.
Now, that technology features on both the iPhone 6 and the iPhone 6 Plus, either of which will be required if you would like to take advantage of Apple Pay for both in-store and in-app purchases. However, owners of the new iPad Air 2 and iPad mini 3 are also able to use it, albeit solely within apps. The Californian tech giant has added that even the upcoming Apple Watch will incorporate Apple Pay, which will also enable its use by owners of the iPhone 5, iPhone 5s and "unapologetically plastic" iPhone 5c.
As Apple Pay was first announced as part of the same September 9 keynote that debuted the Apple Watch, iPhone 6 and iPhone 6 Plus, it's understandable that it may have passed you by slightly at the time. Nonetheless, Apple unveiled many details about the payments system even back then, such as that credit and debit cards from the three biggest payment networks - American Express, MasterCard and Visa - are supported.
Apple also listed many of the leading retailers that would support Apple Pay, including Disney Store, Bloomingdale's, Macy's, McDonald's, Subway, Walgreens and Staples - as well as the Cupertino firm's own 258 U.S. retail stores. In a subsequent press release that confirmed October 20 as the date from which Apple Pay would become operational in the U.S., it was also revealed that 500 more banks from across the country had thrown their weight behind the system.
Apple Pa y prioritizes the utmost security
Apple has already been at pains to emphasize that Apple Pay is not merely about speeding up the process of paying for goods, at the expense of security. The company's senior vice president of Internet Software and Services, Eddy Cue, described security and privacy as being "at the core of Apple Pay", adding that those using it in a store would at no stage of the process be making their name, credit card number or security code visible to the cashier, meaning less scope for fraud.
Nor was Apple savvy to the payment histories of those using Apple Pay, Cue asserted, and in the event of the customer's iPhone being lost, the swift suspension of payments from that device was possible with Find My iPhone. The assignment, encryption and secure storage of a unique Device Account Number in the iPhone or Watch's Secure Element prevents the user's actual card numbers being stored on their device or Apple's servers.
All of these characteristics help to make Apple Pay a truly formidable prospect from a security point of view, and this is without touching on the sheer convenience of using it. Apple describes Apple Pay as enabling customers to "start making payments with the touch of a finger", and it pretty much is that simple. In-store shoppers, for example, just need to hold their iPhone near the contactless reader at the same time as keeping a finger on Touch ID.
Setting up Apple Pay in the first place is naturally a little more complicated than that, but not too much so. As long as you have one of the aforementioned devices running iOS 8.1 or later, together with Touch ID or passcode on your iGadget, as well as an iCloud account, a supported card from a participating bank and the United States as your selected region, you'll be ready to go from the moment you add a credit or debit card to Passbook.
The media already approves
The early verdicts on Apple Pay from the media are, it has to be said, pretty good - albeit with a few reservations, as one may expect with a system like this that remains in its relative infancy. The Wall Street Journal's Geoffrey A. Fowler, for instance, declared that "You no longer have to be a geek to pay for something with your phone", adding: "Shortly after Apple switched it on, I walked to McDonald's without my wallet and bought McNuggets with a wave of my iPhone. It was so easy, the cashier didn't even notice."
Fowler said that Apple Pay was the first service of its type that he trusted "to be secure and consistently easy - fundamentals to taking a digital wallet mainstream." He pronounced Apple Pay "our best hope yet to put overstuffed wallets on a digital diet", despite drawbacks in this early stage of its existence such as an insufficient number of supporting retailers.
The independent tech news site Re/code was another to run the rule over Apple Pay, conducting what it called a "bi-coastal team test" to determine how it fared for shopping on both U.S. coasts. The four members of the team purchased a wide range of items - "from electronics to food to makeup" - via the iPhone 6 and iPhone 6 Plus, coming to the conclusion that "Apple Pay worked smoothly and quickly in all but a very few instances."
One more thing...
Yes, before we leave you, we're choosing to evoke the spirit of Steve Jobs in bringing you something else interesting about Apple Pay - the fact that it can be tricked to be used outside the United States, despite these shores being the only market where it is presently designed to work.
The revelation emerged via a video recently posted by blog site TechSmartt, showing precisely how the system can be set up for use by those outside the U.S. - and judging by responses to the video by users claiming to be from the likes of the Netherlands, Australia and United Arab Emirates, it actually works. Indeed, the person posting the video was Canadian.
The clever workaround is made possible by Apple's use of existing available NFC-based tap-to-pay systems, rather than its own wireless standard. The Canadian user behind the video pulled off the surprising procedure by using a U.S. credit card, navigating to the iOS Settings screen, tapping the General tab and making the United States the phone's selected region.
He then set up Apple Pay, adding his card number, expiration date and security code, before heading to one of the many Canadian stores with an NFC terminal to test whether it worked. Sure enough, it did, Apple's new payments system enabling his purchase of soda from a vending machine that incorporated NF C technology.
Will those outside the U.S. who are eager to give Apple Pay a go be forever restricted to seizing on a loophole like this one? Not necessarily so, if reports are to be believed, despite Apple having not made any comment in this direction thus far. Visa Europe's chief digital officer, Steve Perry, recently told the Financial Times that it was "working closely with Apple and with our member banks to bring this new service to market in Europe."
Apple Pay... truly worth the fuss
Is Apple Pay the complete package just yet? As you might imagine at this formative stage, it isn't - but the potential that it has already shown in its short period of availability tells us everything that we need to know. Almost all of the signs point to Apple Pay being another surefire winner for the Californian firm - another example of its ability to take a technology that it did not invent and make it truly palatable to the smartphone-wielding masses.
One can only imagine, then, just how good Apple Pay will be when its few present disadvantages soon become a thing of the past. Brace yourself for a true new era of hassle-free and swift mobile payments!
by Benjamin Kerry & Gavin Lenaghan