Apple is planning an ambitious new payment system allowing users to replace their credit cards with their iPhone. The company is “very, very serious” about the plan to create new digital payment options and is already hiring executive to run its mobile payment system.
Apple CEO Tim Cook has hinted at Apple’s interest in entering the mobile payment industry in the past, but plans for a payment system using the company’s database of iTunes users have slowed recently. The company has reportedly spoken to web-based payment platform PayPal in recent months.
In a first quarter earnings call, CEO Tim Cook said: “We’re seeing that people love being able to buy content, whether it’s music or movies of books, from their iPhone, using touch ID. The mobile payments area in general is one that we’ve been intrigued with, and that was one of the thoughts behind the Touch ID.”
The Apple CEO continued: “But we’re not limiting ourselves just to that.” Apple has a database of almost 600 million registered users for its iTunes digital content service, along with their linked billing information. In order for the service to succeed, Apple would require the participation of banks, credit card companies, and retailers.
A similar service from Google called Google Wallet has been successful with many shoppers, although Google’s service is slightly different from Apple’s idea. Google Wallet acts as a credit card aggregator, linking credit card and loyalty cards in its users’ wallets to cut down the number of cards users need to carry.
Experts believe that Apple’s service could potentially revolutionise the payments industry, noting that the company’s 600 million accounts is a significant asset for processing payments. In addition to regulatory issues, Apple faces competition in the form of Isis – a payment platform backed by AT&T, Verizon, and T-Mobile.
