I get why the banks are not happy, but I can tell them that I am not going to use Chase Wallet, Bank of America Wallet, Citi Wallet...just pay the fee and be thankful for the reduced payment friction, which they invariably make money from. PS: Nobody is going to use Paze (yet another half baked wallet), other than to collect the free $10 to sign up for it.

Somewhat related, even Walmart relented and now supports Apple Pay/Contactless. Every big merchant has now relented (Kroger, Home Depot, Walmart).

Walmart only relented because they finally broke through the final missing link of the contactless issue. They got customers conned into giving their phone numbers at checkout, just like it's the grocery store.

Cards get linked to accounts automatically behind the scenes based on first6/last4 card number tracking, then everyone else self-selects to punch their phone number on the screen.

Same reason Walmart Radio is such gruesome auditory cancer, it's part of the data collection and advertising vehicle.

That could be part of the reason, but also I think insisting on chip all this time just really slows down a store that doesn't really spend on cashiering all that much. Tap to pay can shave off a few seconds on every transaction (ever been behind someone in the store who finally pulls out their wallet, finds the business end of their card, inserts it, waits 20 seconds...).

Millions of transactions a day, over thousands of stores, it can make a huge difference in time saved.

A possible compromise is to allow Apple Pay to be a monopoly as long as it doesn't charge any fees.

granted i am a bit of schadenfreude at the thought of poor poor megabanks having to pay....fees...

Ultimately it comes out of their customers’ wallets.

Or Apple Pay can just be like Google Wallet is on Android? The alternative is not multiple apps.

How does it work on Google Wallet?

Article says Google wallet works just like Apple Pay, except they don’t charge a 0.15% fee.

Why shouldn’t Apple be able to make money for the service they created?

A service for whom? It has already been paid for by the users when they bought the iPhone.

Users aren’t paying the fee though

The phone holds on to a credit card number and some extra information. What service is happening here? Is Apple doing something meaningful every payment?

There is already apple wallet where i can put any of my banking cards…

Another alternative (in the US, at least) is tapping a piece of plastic instead of your phone and not inviting any of the tech giants into your transactions at all. What an unforced error, to shovel more of your data at them needlessly.

That is much better, but you're still paying visa/mastercard some percentage fee for a service which should be provided by e.g. the central bank.

Yeah. But this is the US. This is all we’ve got. Having the central bank do it would be communism, and that’s bad. I learned about it from Saturday morning cartoons.

Ironically it's the central bank (and associated regulations) that cause these intermediaries to exist to begin with.

A protocol to support decentralized payments is a hobby project for an individual. You give each institution an identifier (e.g. their domain name) and each institution gives each customer an account number. If you're account 123 at Chase then you sign in as #123@chase.com, tell Chase you want to send $5 to #456@bankofamerica.com, they send the money and Bank of America tells their customer they have a new deposit. If you want to collect money from someone, you tell your bank to send their bank a payment request and they can either approve it manually (e.g. so you can deliver the goods for a one-time purchase) or configure some rules for which accounts get approved automatically up to some threshold amount (e.g. for recurring payments). Also no reason for banks in different countries not to all support the same protocol.

That doesn't require a central bank or any centralized third party payments intermediary. All it requires is for banks to know how to send money to other banks, which they obviously already do and the specific implementation of that isn't even relevant to the customer-facing payments protocol. So how does this not exist? It can't be that no one wants it, so it's got to be that someone (e.g. Visa/MasterCard) doesn't want it.

The banks all got together and created Zelle, so it exists. No Visa/Mastercard conspiracy needed.

Zelle is an app rather than a protocol, which is why e.g. PoS terminals and web checkouts don't support it.

is tapping a piece of plastic instead of your phone and not inviting any of the tech giants into your transactions at all.

Apple doesn't see individual transactions when Apple Pay is used at retail stores' tap-to-pay terminals. The secret card payment token is sent from the phone to the credit-card's issuing bank and bypasses Apple servers. In this way, using Apple Pay is more secure and private than plastic cards because the real card number details remains hidden from the merchant.

The iPhone does contact Apple servers to add a new card to the digital wallet. Apple servers then contacts the issuing bank to get the secret token the bank generates and then puts it in the digital wallet. Conceivably, the "add a new card to digital wallet" could also have been done without Apple in the middle but it would require a much more convoluted, less secure, and more user-hostile workflow to do it. (e.g. the end user would have to know what bank endpoint to contact, manually enter the long and cryptic digits of the secret token, or maybe scan a QR code on a computer screen that's vulnerable to interception and phishing.)

don’t be silly, apple displays me exact amount on the screen, in plain fucking text, after each transaction - that’s crazy you wrote this

Man, its amazing how confident you are about this, considering I know individual people who independently work at Visa, Mastercard, AND Apple, who have worked on mobile payments who independently confirm that none of them know any personal info and that its all pass-through.

So, are you sure you know what you are talking about?

This kind of appeal to authority [believe me because I say so!] doesn't really add much information, does it?

The report, above, is that previous transactions are visible within Apple's payment app. Apple agrees[1]. I'm willing to accept that this observation is based on reality and that it is reported in good faith.

Meanwhile, the suggestion is that Apple has no knowledge of transaction history.

Is there a way in which these two seemingly-conflicting concepts can be constructively combined into an understandable whole?

[1]: https://support.apple.com/en-us/104954

(For my part, I've never used Apple Pay and it's possible that I never will. I do not have a dog in this race.)

This is baffling, there's all sorts of information on my phone that Apple has zero knowledge of, why would the transactions be different?

Do you think Apple has complete copies of everything? I don't understand where this supposed contradiction is supposed to exist, unless you think that Apple has complete knowledge of all phone contents, which would require complete ignorance of the entire platform.

Importantly, this provides a degree of protection from compromised PoS terminals. Ever since I switched to nearly exclusively using Apple Pay for physical shopping I’ve had no unauthorized charges, whereas back when I was still tapping, inserting, or swiping my card I’d need to call and get a card or two replaced almost every year.

Inserting and tapping is just as safe.

Swiping is where the risk is.

I’m not super familiar with the implementation details but wouldn’t inserting not be as safe since there’s a physical connection?

With tapping I could see how that is more secure but if they’re still providing the card details versus the secure token or something well… maybe it’s not?

This is the government's problem. I tend to be on the side of less government, but it is so obvious that payment facilitation should be a service provided by the government. The government is just allowing corporations to collect rents, because they are lazy and incompetent.

It's not a government problem, it's a competition problem. Fundamentally 1-3% is actually a very competitive rate for organizing the easy transfer of money and handling fraud. Merchants would rather the cost be free, and banks may want a larger slice of the pie, but until someone comes up with a better way of paying money for both sides this is the best we have. If government got involved all that could happen is fees would increase and then we'd miss out on future efficiency improvements and savings.

0% because it’s a service that’s so obviously should be provided by the government is better.

Fundamentally 1-3% is actually a very competitive rate for organizing the easy transfer of money and handling fraud

This is a very US-centric take. In the UK, EU and Australia, interchange rates are capped at more like 0.2/0.3%.

That actually proves the point, because a market left to itself arrives at 2-3%, and it only goes lower if the government is dictating a rate.

This is fundamentally looking at it the wrong way.

Why do we need my bank to send money to your bank via Visa or the Federal Reserve or any such thing, instead of having my bank send money directly to your bank? All they need to do is both support the same openly specified protocol for transferring money.

Remember CurrenC? The thing a bunch of them tried to make that failed horribly during test with no consumers liking it? If I remember a description it involved using an app where you had to scan a QR code, and then the point of sale terminal had to scan a QR code on your phone or something like that.

It was all so hilariously badly designed compared to tap and pay.

Another argument for turning finance into a public utility. Instead we have different factions of rentier capital competing for who gets to parasitize us.

Another argument for turning finance into a public utility

There already is a public option in the US, FedNow. In EU there's SEPA instant.

Pix and the other variants are the way to go for money transfer, it's just that these monopolies won't be happy to forfeit their easy money, both credit, banks as well as Apple. They are all fighting for monopolies, they must cease to exist for the good of the common folk.

Well, fortunately Pix is statedriven/stateenforced/strateregulated, so it contains some of the most important ingredients to become some type of standard - the only reason why Mastercard et.al. are so powerful is because this area/field of tech was long no recognised as critical/relevant enough.

Pix is doing exactly the right thing, as ECB/SEPA is as well.

Totally, and hopefully if standardisation isn't possible that we will at least see some form of integration between these systems, even if under an international transaction fee.

Working in this field:

The national co-integration is actually not a problem,asmost modern stacks are build on ISO20022 mainly, to the basis for co-integraion exists. Its just that attention on these topics is not that big. You could easily connect Brazil to the ECB with a correct setup.

Initially I was casually (didn’t dig into the issue) fine with Apple allowing only a single access to payment via NFC due to the opportunity for fraud, which was Apple’s justification.

But I haven’t heard of it happening with the wild-west Android NFC payments, much less widespread problems with the essentially unconstrained use of QR code payments on SE Asia (e.g. Alipay).

So as an iPhone user I’m happy for Apple’s lockdown going away. I just hope it doesn’t mean that in future I’ll need to install a dozen payment apps and have to figure out which when I buy things.

If the banks win and other stuff is allowed on the iPhone, that’s fine.

I have no intention of using it. I have a feeling it’ll be crap. That’s how this stuff usually is. And I’m absolutely not going to use a different app for each card.

So I wonder if this will end up being a Pyrrhic victory.

I hope we get tap to pay on GrapheneOS in the US soon. You can already use it in the EU with Curve and PayPal. It's a blocker for a lot of people.

Hacker News seems generally not interested in private payments or how terrible the banking system is, which is disappointing.

https://eylenburg.github.io/payments.htm

There's walt, which will be launching soon.

https://walt.is/

It is estimated Apple Pay does anywhere between $5T to $10T transaction per year. That is everything from Credit Card to Debit Card. If we average out at 0.1% per transaction over $5T, that is $5B per year.

The transaction itself doesn't touch any Apple severs. In case anyone is wondering if there is an operational cost. There is a set up cost though with the initial verification and sometimes Apple do charge a one time fee per card set up.

There is a privacy angle with using Apple Pay. But I am unsure how much info banks and network is not getting because of it.

Retailers may get less than using their own app, but I agree I don’t really see how it affects the processors or the banks.

However Apple is providing something in all this. Apple Pay requires biometrics which (in theory) should help lower fraud costs for everyone. So it’s not like they’re just rent seeking for nothing.

I don’t know how it went for everyone else, but I don’t remember tapped pay getting popular until after Apple Pay and Apple pushing it. I know that coincided with when EMV terminals really started to get popular because the credit card companies were forcing it. But I honestly wonder if they helped push it to the mainstream, even for people just using tap cards.