Two Major Payments Projects Said to Be Underway at Apple

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Apple, the world’s largest technology company, is said to be poised to unveil a rash of payments products and features, including payments via wristwatch.

Several online news sources are now saying that Apple’s iWatch, which is expected to hit the market this year, will be enabled for payments.

According to FinVentures blogger Tom Noyes, who famously made the right call last year when he said the iPhone 5 would not include near-field communication capabilities, the next iPhone in 2013 will have NFC. NFC, he points out, is not just about what people in the fintech space usually think of: contactless payments. NFC is more like a short-wave radio, capable of doing more than just buying you a cup of coffee.

He also predicts that the coming iPhone — , whether it’s called the 5S or the 6 — will have biometric capabilities for reading fingerprints for authentication and security purposes. Apple is coming late to security, Noyes said, but this next smartphone will go after it in a big way. The added security should boost the confidence of users looking to use iWallet for payments. Paytango, profiled here, walks the same biometric-enabled ground.

Meanwhile, Apple continues to pile on payments patents, such as gesture-based payments and a tab in iTunes called MobilePay, bolstering its payments-related intellectual property. The patents seem to indicate that Apple will leverage iTunes, with its hundreds of millions of credits card accounts that keep PayPal up at night. But some Apple observers are unsure exactly how iTunes and iWallet will work together in the upcoming iPhone iteration.

And most intriguing of all is the suggestion that Apple might use its long-rumored iWatch as a payments mechanism. A commentator on Noyes’s blog writes:

Paying with the phone itself has its downsides, especially in case of transit. Public transport is currently the most compelling and “here now” use case for mobile payments. Another interesting and practical use case is [two-factor authentication].

A smartwatch offers a much better UX in both cases. … [M]obile operators are not in the picture as far as a smartwatch is concerned — few even realize that it is a bigger threat than an embedded secure element.

As for [know your customer], wouldn’t banks have a better (i.e. “deeper”) value proposition there, compared to [mobile network operators]?

Apple reportedly has 100 designers working on the iWatch design. The device is predicted to feature a 1.5-inch display, a curved glass face, and Bluetooth to connect to an iPhone or other mobile devices. So an NFC-enabled iWatch that connects to your smartphone? Is this a better wearable tech play than Google’s goofy glasses?

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  1. […] Apple, the world's largest technology company, is said to be poised to unveil a rash of payments products and features, including payments via wristwatch. Several online news sources are now saying…  […]

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