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Apple in Talks With Credit Card Companies Over Payment Solution, Could Launch Mobile 'Wallet' This Fall

Wednesday July 23, 2014 2:24 pm PDT by Juli Clover
applestore.pngApple's talks with companies in the payment industry have been heating up in recent months, according to a new report from The Information. Apple executives have discussed launching a mobile payment solution as soon as this fall, allowing users to pay for physical goods with their iPhones.

Apple is currently speaking with credit card company Visa over a possible partnership, a move that would bypass third-party payment processors resulting in direct savings for retailers and customers.

Apple's payment solution is said to work with a "secured element" within the iPhone, safely storing payment credentials. This secured solution may involve the "Secure Enclave" built into Apple's A7 processor.
Apple has told some partners its system would involve a so-called secured element in the phones--a piece of hardware where sensitive information such as a phone owner's financial credentials can be stored. The company also aims to run the system without giving up any control to wireless carriers.
The Secure Enclave, which was designed for Touch ID, is a coprocessor within the A7 chip that uses a secure boot process to ensure that its separate software is both verified and signed by Apple. It functions independently even if a kernel is compromised and contains a unique ID that is inaccessible to other parts of the system, keeping all data held within safe.

Apple's interest in the mobile payment arena has been rumored for years, but gained renewed attention earlier this year when The Wall Street Journal suggested the company as working on a new mobile payment service. As previously detailed, the service is said to allow people to use their iOS devices to make purchases for physical goods in apps and on the web, as well as in retail stores.

The payment solution will most likely be built around iTunes, allowing Apple to leverage more than 800 million iTunes accounts, most with credit cards attached. It may also be tied to Touch ID, the fingerprint scanning home button built into the iPhone 5s and slated for inclusion in future iPads and iPhones.

In January, Apple CEO Tim Cook said that mobile payments were "one of the thoughts" behind Touch ID. He has also said that Apple is "intrigued" with mobile payments and noted there's a "big opportunity on the platform."

Earlier this year, Apple was said to be in talks with Paypal about a possible partnership and it has also sought out senior payments industry executives to take on roles within the company.

Related Roundup: Apple Pay
[ 111 comments ]

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newagemac
68 months ago
Yosemite. iOS8. Handoff and Continuity. Healthkit. Homekit. TouchID. Mobile Payments. iWatch??? Apple TV???

Apple's entire integration plan seems to finally all be coming together. It's going to be really nice to be in the Apple ecosystem going forward.
Rating: 16 Votes
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2010mini
68 months ago

Apple buy paypal already


eBay is selling paypal?
Rating: 4 Votes
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Cougarcat
68 months ago
But, will it be faster than just swiping my card? If I have to muck about with the UI on my phone, I see little point.
Rating: 4 Votes
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Davelfc
68 months ago
People will quite happily hand over their card to a complete stranger serving in a shop, who can then skim it. Revealing their card number, 3 digit code on the read and signature.

But offer people a more secure way of carrying out their transactions, that involve a fingerprint and they go crazy.

It cannot come quickly enough for me. Now I just need to find way to keep my thumbs more secure.
Rating: 3 Votes
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HobeSoundDarryl
68 months ago

But, will it be faster than just swiping my card? If I have to muck about with the UI on my phone, I see little point.


There's a HUGE security benefit to going this way instead of continuing to use cards. Nutshell version: as is, much of the time, we hand our credit cards to complete strangers who then go away where we can't see them to process our purchase. They bring back a piece of paper that we sign, so we give those strangers our signature too.

Mobile "card-less" model: nothing leaves your possession. Your "card" (your phone) has something brought to it so that you can establish the connection to approve the transaction yourself. Your thumbprint or password is the replacement for your signature. The "stranger" doesn't get to see a card number, name, expiration date, security code or your signature; they just get a "transaction approved" validation.

While the latter is also not completely secure (nothing is), it would be a HUGE step toward reducing the ability for the less sophisticated identity thieves (which is most of them) to fake a transaction(s) as you.

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What happens if someone steals the iPhone. Are the iPhones so secure with the new technology?


They need to steal your thumb and/or your password too.
Rating: 3 Votes
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realeric
68 months ago
Mobile payment solution better than Paypal, please...
Rating: 3 Votes
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w00master
68 months ago

Apple buy paypal already


I doubt eBay would be willing to sell. Also... I don't think Apple wants eBay either.

w00master
Rating: 3 Votes
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teoreticar
68 months ago
Apple buy paypal already
Rating: 3 Votes
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AustinIllini
68 months ago
I didn't know I wanted NFC until I got it. It's fantastic where available.
Rating: 2 Votes
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afsnyder
68 months ago

I'm not sure why anyone would be concerned that this could be a bad thing because your iPhone could get stolen. So can your credit card or wallet! This solution is probably even more secure, as iPhones are password-protected.


And if your phone gets stolen... tough because they need Touch ID to make the payments anyway.
Rating: 2 Votes

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