Apple changed the way you shop for music and movies and audiobooks. Now the tech giant wants to change the way you shop, period, by turning your iPhone or iPad into your new credit or debit card. The Wall Street Journal reports Apple is in the process of building a mobile payments system to compete directly with PayPal, Google and Square.
Apple already has the pieces in place to build a mobile payment empire. iTunes has an archive of credit card numbers on file. (TechCrunch puts the number close to an astonishing 600 million.) The iPhone 5 requires your fingerprint — a built in security system more fool-proof than a PIN number — and the iBeacon service can verify whether or not you're physically in a store when a purchase happens. If these existing functions were to come together, like a technological Voltron, Apple could very easily become a force in mobile payments.
We do not yet know what an Apple mobile payment strategy will look like. But we do know Apple considers it a strong priority. Jennifer Bailey, the head of Apple's online store, was assigned to head the mobile payment initiative. This came after Apple spoke with "at least five other well-known executives in the payment industry" before choosing Bailey, according to the Journal.
For now, Apple's mobile shopping plan is still in the preliminary stages. A patent discovered last week indicates Apple is exploring using its iBeacon technology to send wireless signals from your phone to a receiver that could securely transmit mobile payments. In other words, you could pay for groceries with a simple swipe of your iPhone. But the Journal posits Apple could make a smaller splash in the mobile payment world, at least initially, by making it easier to pay with your credit card stored in Apple's archives when shopping on your iPhone or iPad. Instead of requiring you to enter your credit card number when shopping online, Apple would enter your number for you.
Apple tinkered with the idea of mobile payments before. But Apple decided the timing wasn't right and put the idea on the back burner. But if, or when, Apple pulls the trigger on a mobile payment strategy, the rest of the industry should be ready to compete.