Apple Pay™ is in the news as the newest form of payment in the payments industry. At its core, Apple Pay™ is a digital wallet – an electronic device that allows an individual to make electronic commerce transactions. It is meant to be simple and safer than traditional card-based payments, but what is it really offering us? Will it change the payment landscape as many people predict?

It’s important to understand some of the logistics of the system because the “ease of use” will impact how consumers use the system.

Our In’cider’s Point of View

There are many players and technology layers in the payment system that have to align before the transaction can be processed:

  1. The card issued by the bank must be Apple Pay™ compatible.
  2. The merchant must be able to accept Apple Pay™ as a payment. You’ve probably seen some of the new card readers as you check out at your favorite department store or grocery store, being Apple Pay™ capable. This means the terminal will accept the Apple Pay™ “tap and go” payment mechanism by using Near Field Communication (NFC) technology.
  3. The networks must be able to accept the transaction and transmit the transaction.
  4. VISA and MasterCard must be able to create the “token” for Apple Pay™ once the consumer creates the wallet on his/her iPhone.
  5. You must have iPhone 6 or iPhone 6 Plus to originate an Apple Pay™ transaction (sorry Android users – you are out of the game).

The message here is that there are a many players involved in the transaction and the planets must align before the transaction will even begin to process.

So will this be a game-changer in the payments landscape? I believe so. If not Apple Pay™, then another payment mechanism or digital wallet will follow because consumers are looking for a convenient and safe way to complete a transaction. As I said before, if you’re an Android phone user, Apple Pay™ will not work for you, but rest assured there will be many other digital wallets that will follow the trail blazed by Apple Pay™.

No Worms in This Apple

Apple Pay™ will be safer than traditional card transactions because the card information will be encrypted and replaced with a token that is unique to the cardholder and phone. This will ensure card information will be safe and more difficult to steal than traditional magnetic stripe card transactions.

First Business Bank credit cards, both consumer and business, are Apple Pay™ compatible today. So if you have an iPhone 6 or 6 Plus and want the convenience of tap and go transactions at POS terminals, download the app, load your card, and begin shopping.

For more information about Apple Pay™, visit the Apple website at: