Apple Pay launch Monday: The newest mobile wallet technology

By Jeff Harvey

This Monday, Apple Pay will be launched, allowing iphone 6 and iphone 6 plus users to make in-store purchases with a single touch.  By storing credit and debit cards in the Passbook app (which is already a secure space to store boarding passes, tickets, coupons and more) users are able to pay for items at select stores in a simple and secure way.

Promoting Privacy

A primary concern that has been brought up among users is privacy.  To address this, Apple insists that the user’s account information and purchase information remain private once Apple Pay is set up.  To accomplish this, whenever a card is added to a device, the card numbers are not stored and each card is assigned a Device Account Number which is kept in the Secure Element chip inside the device. 

Apple and merchants only have access to the Device Account Number and the card information is never saved on an Apple server.   In addition, not only is the card information private, but so is the purchase information.  Apple Pay does not track purchases so transactions cannot be linked back to you, unlike the Google pay application which tracks trends. 

Also, if a credit or debit card is lost or stolen, the user needs to notify the bank and cancel the card.  With Apple Pay, because the card number is never actually used, if the device is lost or stolen, the user only has to assign a new Device Account Number, the card and account information itself remains protected.

Where is it accepted?

Apple has announced the list of 35 retail brands including Starbucks, Target and Groupon, and 23 store brands including McDonalds, Bloomingdales, Apple and Macy’s that are equipped with the contactless payment technology for Apple Pay.  Users can make their purchases within participating apps on iPhone 6, iPad Air 2 and iPad mini 3.

"We believe Apple Pay is going to be huge," Apple CEO Tim Cook said in his presentation, ignoring the difficulties faced by previous mobile wallet schemes, including Google Wallet and Softcard, formerly known as Isis. "It's going to change the way we pay for things. The journey begins [Monday] and we can't wait."

How it works

Apple Pay utilizes a new token technology along with the Touch ID so that all purchases are private and authorization for a purchase is specific to the user.  To use Apple Pay in stores, Near Field Communication chips inside the phones or other compatible devices are read by NFC readers which have been installed to about 220,000 various store locations across the nation.  Apple Pay is compatible with Mastercard, Visa and American Express and uses technology backed by more than 500 banks including but not limited to Chase, US Bank, Bank of America and Capital One. 

Apple is excited for the launch and eager to see how users respond to the newest mobile wallet technology.

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