More signs point to mobile payments for iPhone 6 -- and for an iWatch

The rumors keep mounting that Apple will use its Tuesday event to announce the use of near-field communications tech for mobile payments. The latest claims come via a banking news site.

Lance Whitney Contributing Writer
Lance Whitney is a freelance technology writer and trainer and a former IT professional. He's written for Time, CNET, PCMag, and several other publications. He's the author of two tech books--one on Windows and another on LinkedIn.
Lance Whitney
3 min read

Will NFC finally make its ways to the iPhone? CNET

Apple will finally dive into the mobile-payments market with NFC tech for the iPhone 6 -- and for an iWatch -- according to a report published Sunday by a banking news site.

Citing "sources close to Apple and with knowledge of Apple's plans for its new smartphone," Bank Innovation reported that NFC, or near-field communications, is already being used at Apple Stores and Apple retail partners. As the other step, Apple has added NFC to the iPhone 6 and the iWatch as a way of transferring data between devices for mobile payments and other applications.

The possibility of Apple embracing mobile payments came up in January when Apple CEO Tim Cook called the concept a " big opportunity." As Apple nears the almost-certain unveiling of the next iPhone on Tuesday, more and more rumors have cropped up regarding a mobile-payments system and the inclusion of NFC.

NFC is a technology that lets mobile devices wirelessly communicate with each other and with other gadgets via a touchless, short-distance connection. Though NFC can be used for a variety of purposes, it's most commonly seen as a way to use your mobile phone to "talk" to a point-of-sale terminal at a store, restaurant, or other business in order to pay for items on the go.

Several Android phones already support NFC, but the technology has yet to catch on with consumers. Apple has so far resisted diving into the pool. However, an NFC-enabled iPhone 6 could provide the oomph the market needs to take off.

To communicate via NFC, Apple's devices would use "tokens," according to Bank Innovation. And just what does that mean?

Instead of transferring actual credit and debit card numbers, Apple's devices would use tokens that transmit complex codes between devices. Banks and financial companies prefer to use tokens, Bank Innovation said, as they're good only once and so they're of no value to cybercriminals who may intercept them.

Using tokens "certainly addresses security and fraud...there's another part of the story -- tokens provide innovators with flexible, purposed, and driven credentials in their customers' experiences instead of actual data," Brad Greene, Visa's vice president of digital solutions, told Bank Innovation. "If tokens are intercepted by an attacker...[they] would be worthless or [their value would] greatly diminish."

Security has been one of the major concerns among consumers as far as using their mobile devices to pay for items at retail. That concern is one of several reasons why NFC-based mobile payments haven't caught on despite industry efforts to push the technology. Assuming Bank Innovation's report is true, the use of tokens could quell some of those fears and convince more people to give the technology a shot, especially if Apple stands behind it.

Apple declined CNET's request to comment.

Apple will host an event on Tuesday in which it's expected to unveil the new iPhone and potentially the iWatch. CNET will host a live blog Tuesday starting with an event preview at 8:45 a.m. PT and continuing through the 10 a.m. PT event itself.