Apple Pay

Sandwiched in-between the two hardware announcements that Apple made on Tuesday they spent some time talking about a new service called Apple Pay. Apple Pay is a new payment option that uses NFC built into the iPhone 6 and iPhone 6 Plus to make purchases in retail stores and iOS applications that make use of new APIs in iOS 8.

Apple took a different approach than most other companies have when they built Apple Pay. It doesn’t seem focused on making the company money, but instead is focused on creating a better user experience. Security and usability are the two key points that Eddy Cue emphasized during his presentation on stage. And with Target’s credit card fiasco still fresh in everyone’s mind and news of Home Depot’s recent credit card breach, this announcement coincidentally comes at a time when everyone is thinking more seriously about security in regards to their credit and debit cards.

When you setup Apple Pay on your iPhone 6 or 6 Plus you’ll be given the option to add your credit card that you already have on file for iTunes. If you’d like to add new cards the application prompts you to take a picture of your card from within the app, Apple then verifies that the card is yours, and adds it to Passbook as an Apple Pay option.

From a security standpoint, your iPhone doesn’t actually save your card information, instead saving device-specific account numbers and creating one-time card numbers and security codes each time you make a purchase. If you’re iPhone is lost or stolen you’ll be able to suspend payments on the device with Find My iPhone. And there’s no need to cancel your credit card, because the phone doesn’t save your actual account information.

I consider Apple Pay to be the most thoughtfully designed payment service available. It’s highly secure, easy to use, and simple to manage. But, I’m not sold on the whole “pay with your device” concept and never have been.

I’ve worked in retail for six years and can assure you that digging a credit card out of your purse or wallet isn’t going to take any longer than digging your phone out of your purse or pocket. The video that Tim Cook played on stage of a women at the cash register was a gross exaggeration of how long it takes to pay with a credit card. Many people will perceive Apple Pay as a quicker option at checkout than paying with their credit card. But, if you have your card ready when you get to the cashier, it’s just as quick to swipe your card and hit the green button as it would be to hold your iPhone up to the scanner with your thumb on the home button.

I loved what Eddy Cue said on stage about privacy, though:

So when you go to a physical location and use Apple Pay, Apple doesn’t know what you bought, where you bought it, or how much you paid for it. The transaction is between you, the merchant, and your bank. And the cashier doesn’t get to see your name, credit card number, or security code, like they do today when you hand them a plastic card.

I’m a little concerned about that “when you go to a physical location” qualifier but this is definitely reassuring to anyone who was worried about privacy with Apple Pay. “We are not in the business of collecting your data” is a pretty good concept to pitch in a world where nearly every other tech company is in the business of collecting your data.

I joked on Twitter during the keynote that “now my credit card has a battery life.” Which was obviously said in jest but could actually be a concern for Apple Pay users. An early morning rise into a late night out with friends could become problematic when you go to buy another drink and your iPhone’s battery is dead. This can’t be the only form of payment you carry with you for this very reason.

I think Apple Pay will succeed — a lot of people are excited about it and it is more thoughtfully executed than any other competing solution on the market. But, I’m going to give it two or three years before I decide whether or not its something I’d want to use myself. Until then I’ll stick with my trusty debit card and the occasional few paper bills that end up in my wallet from time to time.