What is it?
Apple’s new payment service (https://www.apple.com/apple-pay), which lets you buy items in shops by tapping your iPhone or iPad. It arrived on Apple devices on 20 October as part o f the iOS 8.1 update, but is only available in the US at the moment, although Apple says it’s “working hard” to bring it to the UK. Hopefully, that means it will arrive here in 2015, though you will need a new Apple device because it only works on the iPhone 6 (and 6 Plus), the iPad Air 2, iPad Mini 3 and the Apple Watch.
How does it work?
It uses Near Field Communication (NFC) to make a payment from your credit or debit card, which you first need to add to the Passbook app through your device’s settings. Once that’s done, you just hold your device against a credit-card reader in a shop, then press your finger on Apple’s Touch ID button, which scans your fingerprint to confirm your identity. This makes it very safe – a thief won’t be able to use it. You can also use Apple Pay to buy apps, saving you the hassle of entering your details every time.
So the main benefit is speed?
Yes – payments take a few seconds.
Apple Pay is part o f the ‘contactless payment’ revolution, which is killing off the PIN in the same way that credit and debit cards killed off the cheque. Many UK shops now accept contactless cards, while London buses no longer accept coins as payment.
How safe is it really?
Extremely. Your bank details are encrypted in a chip called Secure Element and not in the device’s software, which means no one can hack into your
phone or tablet to steal your bank details. Even if hackers dismantled your phone, the payment system would detect damage and shut itself down.
To process a payment, Apple Pay creates a random 16-digit Device Account Number, along with a code that’s unique to that transaction. At no point is your card number seen by anyone, so it’s far safer than, say, handing a card to a waiter at the end of a meal.
And just to be completely safe, if you lose your device you can lock Apple Pay remotely using the ‘Find My iPhone’ tool on another Apple device, or from your browser.
Ah, but won’t Apple know what I’ve bought?
No, it won’t track your purchases. Nor are any
of the payment numbers saved on Apple’s servers. But Apple will make lots o f m on ey – by taking a cut from each transaction – giving the company a slice of the huge amounts banks generate each year from credit-card transactions (over $40 billion).
Do Android devices also let you make contactless payments?
Yes, if they have NFC built in (and dozens do – here’s a list: www.nfcworld.com/nfc-phones-list), but you’ll need to install EE’s Cash on Tap (www.snipca.com/14116) or Vodafone’s SmartPass app (www.snipca.com/14117) to use it in the UK. From next year you’ll also be able to use the contactless app Zapp (www. zapp.co.uk), which Sainsbury’s and Asda have said they’ll accept, letting you buy Computeractive with a tap of your phone!