iPhone and payments – different year, same old question …

Written by on September 2, 2014 in BillingViews, Guest Blog with 1 Comment

For the third year running the tech press has been debating whether or not the new iPhone will have an NFC chip and whether Apple will launch an NFC based payments service. This year leaked parts from the new iPhone appear to confirm that an NFC chip is definitely present and speculation has focussed on what exactly Apple will do with payments, especially as the word is that Apple has signed agreements with Visa, MasterCard and American Express.

Despite all the theories and rumours, no one has any idea what Apple’s plans are and whether they will utilise iTunes accounts, other cards, Touch ID, Passbook, NFC, Bluetooth LE or something else. The most likely scenario appears to be a digital wallet unlocked via Touch ID that will allow NFC contactless payments to be made and charged to an existing card.

However, if Apple is going to be successful in payments they have to launch a payments service that is not just better than existing payment methods but much better. Taking friction and frustration out of the payment process is the key challenge for Apple here.

Simply replacing a contactless card with a NFC phone is limited progress at best and in some respects less convenient than a simple card. Apple’s history of taking something and doing it better suggests that their payment model will do more than this and include functionality that will capture the consumer imagination.

How will Apple make money in a commoditised business where margins are thin? Maybe they don’t plan to and payments is just another way of making your iPhone even more indispensable.

But all this is just speculation and we will have to wait until 9 September to find out more …

You can follow Jonathan on Twitter @sevendotzero

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About the Author

About the Author: Jonathan has been working in payments for 18 years covering digital money, identity verification, telco billing, finance systems and consumer payment services; in both startup and corporate environments. Most recently, his experience is in developing alternative consumer payment models. "I'm passionate about removing the friction and frustration from payments. The convergence of payments and mobile technology and its impact on consumers fascinates me." You can follow Jonathan on Twitter at @sevendotzero .


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  1. Jonathan – I agree that we should expect Apple to offer rather more than a marginal improvement for iphone users. Let’s see what they come up with!

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