Apple Pay set to "accelerate" mobile payments in Australia

With Apple's announcement overnight of the imminent arrival of Apple Pay contactless payments, Australian Apple fans are already eagerly awaiting its local launch.

Apple Pay allows iPhone 6, iPhone 6 Plus, and Apple Watch owners to make quick payments with their device using built-in NFC capability and Touch ID fingerprint access. Similar to Visa payWave and PayPass from MasterCard, consumers will be able to hold their device to a contactless payment terminal and make quick and secure payments while their details stay encrypted.

The service is launching in the US from October 2014 as a free update to iOS 8, with support from a number of local retailers there including McDonald's, Target, and Subway. There's no timeline for an Australian launch, but Apple senior vice president of internet services Eddy Cue said the company was "working hard to bring Apple Pay to even more countries".

Apple's local team did not offer any information on an Australian launch and the local providers aren't offering much in the way of confirmation either.

However, an October launch in the US seems to indicate that current retail point-of-sale infrastructure won't need to be completely overhauled -- the demonstration video at Apple's launch showed an Apple Pay transaction occurring at a regular contactless terminal.

Visa, which already has its own contactless card payment system, declared it would work with Apple Pay "to accelerate secure mobile payments in Australia," but offered little in the way of concrete details for a local launch.

"Australia is leading the world in its adoption of contactless payments," said Visa's head of emerging products and innovation, George Lawson. "As Apple Pay rolls out around the world, Visa account holders will be able to use their Apple iPhone 6 to pay at the point of sale, using contactless Visa payWave technology, in app or online in a secure way."

The specific timeline that Visa did confirm was in relation to its new Visa Token Service -- an innovation that "replaces sensitive payment account information found on plastic cards with a digital account number or 'token'." These tokens can be stored by online retailers or on mobile devices without revealing individual account details, increasing security in mobile commerce.

Visa announced that the Token technology would be "available to Visa Inc. issuing financial institutions globally", launching in the US next month, followed by a phased international roll-out beginning in 2015.

With a speedy US launch and the usual anticipation for new Apple technology in Australia, we're hopeful for the quick launch of Apple Pay. Add to this the country's track record in the contactless payments space -- Visa says it processed more than 58 million payWave transactions in Australia in July 2014 alone -- and Australia is a good candidate for this next innovation in mobile payments.

MasterCard

Visa's major competitor MasterCard has announced global support for Apple Pay and availability in the US, but a local MasterCard spokesperson advised CNET that Apple has not provided any additional information on a timeframe for Australia.

"Australia is, however, in a great position to continue to rollout mobile contactless payments, with Australians leading the world in adoption of contactless payments," the spokesperson said. "Currently, one in two MasterCard transactions under $100 are made using contactless technology, and there are more than 320,000 contactless terminals in use across the country."

Commonwealth Bank

The Commonwealth Bank touted its current credentials in the contactless space (the bank offers NFC payments with compatible iPhones and Android phones using PayTag), but only said it was "examining the details of the [Apple] announcement including the newly released features of the phone... and how this will affect any of our suite of iOS applications designed for the iPhone".

Westpac

"This type of mobile payment experience exists in Australia through multiple banks, and Westpac customers are today making Tap and Pay payments through the Westpac mobile banking application on Samsung's flagship smartphones.

"We look forward to working with Apple to open up the [Apple Pay] solution to our mobile banking application in the same way they have opened up the Touch ID fingerprint security in IOS8. The fingerprint login is soon to be launched through our mobile banking applications."

NAB

"NAB is working closely with scheme providers on how they will be introducing this capability to Australia."

ANZ

"Given Apple has only launched it in America at this stage, we look forward to seeing further details on it, including where and when it will next be rolled out.

"ANZ has been running a mobile wallet pilot utilising NFC for sometime. We'll be commercially launching this product to our customers next year."

Updated at 12:17 p.m. AEST to include comments from Westpac.

Updated at 2:50 p.m. AEST to included additional comments from MasterCard.

Updated September 12 at 9:25 a.m. AEST to include comments from NAB and ANZ.