[NewsPoster]

A report in the Wall Street Journal suggests that Apple CEO Tim Cook and senior VP of Internet Software and Services Eddy Cue have been holding meetings and discussions with other technology business leaders regarding an Apple-branded mobile payment system. Buyers could, for example, simply scan a product barcode using their iPhone, confirm the purchase, and instantly pay for it through their iTunes or linked credit card accounts.

The model for the concept is already at work in Apple retail stores, where customers who have the Apple Store app on their devices can scan and pay for any item in the store using a system called EasyPay. If true, the move would be a logical step forward from the work Apple has already put into its iTunes infrastructure, Passbook e-wallet technology, and iBeacon Bluetooth-powered hardware.

Starting with iOS 7, Apple has included native barcode-reading ability in iOS, which lets users scan iTunes gift cards for instant credit on their accounts (rather than typing in complicated alphanumeric codes), and lets third-party developers incorporate barcode scanning into inventory databases and other types of programs. The cameras in smartphones are already accurate enough for basic OCR, QR code, and other types of information scanning. Retina displays produce codes accurately enough for them to be read with handheld scanners.

The Passbook app, Apple's implementation of e-wallet technology, is currently used mostly to redeem tickets, passes and coupons -- though it can also store loyalty cards, and could easily be adapted to store credit cards or gift card information as well. The company has also introduced Touch ID on its latest iPhones, and a synced "iCloud keychain" that encourages the use of complex passwords, and is secure enough to store credit card and other sensitive data. Tying iCloud keychain and Touch ID to Passbook would create a system that can store private information, but would be unusable to anyone but the authorized owner, even if the device fell into the wrong hands.

In addition to iBeacons creating a method to allow POS transactions that verify the "instant purchases" with merchants, the company has patented a number of systems of mobile payments, including secure "touchless" options. In combination, the proposed Apple system would present a few advantages over Google's failed NFC initiative -- starting with the over 500 million iTunes accounts already tied to credit cards that Apple has on file (a figure that grows by at least 100 million each year). This user base would also convince merchants to sign up for Apple's system (a number of companies outside of Apple have already been piloting iPhone and iPod touch-based payment systems, and more are signing up to use iBeacons).

Apple's established bank of users who already have credit information with iTunes and know how to use the system to pay for things would make establishing mobile payments much easier than requiring users to set up a new system and get used to new technology from scratch. A number of efforts have been made by retailers and tech companies to collaborate on easier payment systems, but none thus far have taken the market -- or consumers -- by storm.

(thumbnail photo via Pocketlint.com)

[Inkling]

There must be money to be made--and lots of it--in laundering purchases through a corporate system like Apple's planned scheme and taking a slice of the purchase price. The downside is that retailers will pass along that cost to all their customer even though it may be used only by a few. On the other hand, it'd be great if, when we make a purchase, we could tag the data stream into our bank accounts with what we bought with that money via our iPhones.

[Spheric Harlot]

I have absolutely no idea what you are trying to say.

[vinnieA2]

"when we make a purchase, we could tag the data stream into our bank accounts with what we bought with that money via our iPhones"
An almost instantaneous receipt in your inbox isn't good enough?

[Inkling]

For those who don't understand what I'd though would be obvious. Credit card transactions can be cryptic, particularly when looked at many months later. It'd be great if, when we made them, we could add two things that'd be placed in our bank statements. 1. A short note about what was purchased. 2. The tax-related classification. We have always been able to do that on our checks and in our checkbooks. It'd be great if credit card transactions could have a similar feature. That isn't possible with a plastic card. It is possible with an iPhone app. And that, if Apple is listening, would provide people with a reason to use their iPhone rather than that card.

[Spheric Harlot]

Oh. So you're just saying that this would be an opportunity for Apple to add a more descriptive transaction name.
(I still see no way to turn what you wrote above into that simple statement, but I'll take your word for it that that is in fact what you meant.)

I doubt this is possible, because it's the company you buy from that sets that name, not the company in charge of the transaction.

[yticolev]

An app that would allow a user text comment to be added to the transaction, and user category sorting. That would certainly be useful to some. I'm wouldn't be surprised if one of the scan apps does that. Very useful for business. Square and other credit card processors could certainly supply an app that notifies you of recent purchases and allows you to do just what Inkling is saying. That would pull the rug out from at least one innovative feature that Apple might add.

[burger]

Can you imagine someone reviewing their item tax code receipt in line at a busy retailer. That would be worse than people balancing their checkbook or trying to figure out what 3 liter of soda to buy with their food stamps.