So you bought a new iPhone 6 or 6 Plus. Congrats! The two phones are packed full of cool features like Siri and Apple Pay. The latter is particularly cool, as it promises to revolutionize how we approach paying for goods by putting our money on our phones.
Apple Pay is pretty neat. If you’re interested in using it or even how the system works, we prepared a quick guide for everything related to Apple Pay.
What Is Apple Pay?
On the most basic level, Apple Pay is a way to pay for stuff with your phone. The credit card attached to your iTunes account pays for stuff at special wireless terminals.
Hold the phone next to a terminal, hold your finger over the home button to activate TouchID, and it pays.
(For reference, when I refer to the iPhone 6 from now on, it means the iPhone 6 Plus as well)
The iPhone 6 is the first version of the iPhone to ship with Near Field Communication or NFC. The phone uses it to wireless transmit your payment data with NFC terminals.
Is It Safe to Use Apple Pay?
As far as we know, Apple Pay is safe. Apple is big on personal privacy and has taken a lot of important steps to protect your data.
When you pay for something with a debit or credit card, the card’s chip and the reader create something called a cryptogram. This is the security key for that particular transaction.
The cryptogram is sent back to the bank to process the transaction.
Apple Pay uses a similar system. When you use an iPhone to pay for something, it generates a cryptogram and a 16-digit token.
This token is unique to each iPhone and is stored on a secure chip within the iPhone. When the user pays for something using Apple Pay, the banks check the cryptogram and the token to make sure it’s legit.
For more, check out this interesting explanation from Bank Innovation.
Does it Work on my iPhone?
Apple Pay in stores works only on the iPhone 6 and 6 Plus. They are the only models with NFC, the technology powering all this. Any other iPhone cannot use Apple Pay.
Where Can I Use Apple Pay?
A small but growing number of stores accept Apple Pay. These currently include:
- American Eagle Outfitters
- Babies ‘R’ Us
- BJ’s Wholesale Club
- Champs Sports
- Chevron and Texaco, including retail stores like ExtraMile
- The Disney Store
- Duane Reade
- Foot Locker
- Harveys Supermarket
- Jewel Osco
- Office Depot
- Panera Bread
- Petco and Unleashed by Petco
- Save Mart Supermarkets
- Sports Authority
- Sprouts Farmers Market
- Star Market
- Toys ‘R’ Us
- United Supermarkets
- Whole Foods Market
Why Aren’t There More Stores?
Funny story there. While banks love Apple Pay (more on that in a second), a group of major retailers is teaming up to create a competing virtual payment system.
Major stores like Best Buy, Walmart and CVS have been disabling their NFC readers to prevent people from using Apple Pay.
The retailers want people to use CurrentC, their in-progress mobile payments app that looks… lacking. It displays a QR code on your phone for scanning, which takes money straight out of your checking account to pay for stuff in the stores.
The idea is to entice customers with coupons and discounts and cut out banks and credit card companies from taking a chunk of every transaction.
The list of stores using CurrentC (and not Apple Pay) is also quite long:
- Acme Fresh Market
- Bahama Breeze Island Grille
- Banana Republic
- Baskin Robbins
- Bed Bath & Beyond
- Best Buy
- Buy Buy Baby
- The Capital Grille
- Christmas Tree Shops
- Circle K
- Dick’s Sporting Goods
- Dunkin’ Donuts
- Eddie V’s Prime Seafood
- Exxon Mobil
- Face Values
- GetGo from Giant Eagle
- Giant Eagle
- Hobby Lobby
- Longhorn Steakhouse
- Maggiano’s Little Italy
- Michaels Arts & Crafts
- My Good Market
- Old Navy
- Olive Garden
- Phillips 66
- Price Rite
- Sam’s Club
- Seasons 52 Fresh Grill
- Southwest Airlines
- Yard House
Haven’t We Tried All This Before With Google Wallet?
Yes. Google Wallet launched in 2011. It was a revolutionary product far ahead of its time that was brought down because everyone but Android nerds hated it.
The banks hated Wallet because Google was trying to collect data the banks didn’t want them to have. The carriers hated it because they weren’t getting a cut (Verizon completely blocked it on their devices).
Apple Pay stands a greater chance of success because Apple can push it instantly to all its phones, unlike the Wallet’s patchy rollout and support.
The banks also love Apple Pay because it doesn’t collect user data for Apple and lowers the effort of buying something, making people more likely to buy more.
Do I Have to Update My iPhone to Use Apple Pay?
Probably not, depending on your version. Apple Pay works on iOS 8.1 and up, and most people are usually up to date. If you’re not sure which iOS version you have, go to Settings > General > About > Version.
Can I use it with the Apple Watch?
Yes! Double-click the side button on an Apple Watch near an NFC terminal. It’ll pulse and show your credit card with a check mark to show the payment went through.
Apple Pay promises to be a useful tool in the future, though its limited support may make it difficult to spread among users.