Phew! Apple reveals ‘Tap to Pay’ enabling fintechs to use the iPhone’s NFC chip

By Oliver Smith on Wednesday 9 February 2022

Digital Banking

Earlier reports had indicated that Apple was looking to compete directly with Square and Zettle.

Phew! Apple reveals ‘Tap to Pay’ enabling fintechs to use the iPhone’s NFC chip
Image source: Apple.

Apple is opening up access to the iPhone’s NFC chip in the US later this year, letting fintechs accept point-of-sale payments.

The feature is aimed at “millions of merchants” who will be able to accept contactless payments via credit card, debit card or Apple Pay, and without needing additional hardware.

While Bloomberg last month reported that Apple was looking to “rival Square” by entering the point-of-sale sector, in fact, Apple’s announcement is that it will be working with fintechs, starting with Stripe, to roll out support for Tap to Pay.

“In collaboration with payment platforms, app developers, and payment networks, we’re making it easier than ever for businesses of all sizes — from solopreneurs to large retailers — to seamlessly accept contactless payments and continue to grow their business,” said Jennifer Bailey, Apple’s vice president of Apple Pay and Apple Wallet.

While the rollout will start with Stripe “later this year”, Apple also said Shopify’s will be launching a Tap to Pay app “this spring” with additional payment apps coming “later this year”.

Given the broad rollout, it’s likely that rather than being a ‘Square rival’, Tap to Pay will likely be embraced by the likes of Square and Zettle as it lets merchants take payments without needing to buy any extra hardware.

Two questions remain, however. 

Firstly, whether Apple will look to take a cut from Tap to Pay transactions, and if Square and Zettle will be willing to sacrifice this cut for the benefit of using Tap to Pay.

And secondly, whether Tap to Pay will expand beyond the US or, like Apple Card, it will remain a US exclusive feature for the time being.

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