How much does apple pay cost to use

No, it does not cost you anything extra to use Apple Pay.

The usual credit or debit charges apply to purchases and some retailers may apply a credit or debit card surcharge to purchases made using any payment method, including Apple Pay, contactless or chip and PIN transactions.

You require an active data plan or Wi-fi connection to add your card to Apple Pay. Based upon your mobile plan and network, additional message and/or data charges may apply.

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Apple Pay Payment Processing

Apple Pay is a mobile wallet application for all iPhone models after the iPhone 6 and for the Apple Watch. It utilizes the iPhone’s NFC capability in conjunction with a built-in fingerprint scanner to enable customers to pay for products with their phones at physical retail locations and within various iPhone and iPad apps. In September 2018, Apple also added the ability to send money to other Apple Pay users in the Messages app (known as “Apple Pay Cash”), similar to Venmo or Square Cash.

Apple Card

On August 20, 2019 Apple launched the Apple Card. The card integrates into Apple Pay users’ digital wallets. The card also provides users with similar benefits to conventional credit cards. Those benefits include 3% cashback for purchases from Apple, and 2% for any purchase made using Apple Pay.

Competes with Samsung and Google

Before they can use the service, Apple Pay users are first required to enter their card information into each device’s Wallet application, where the card information is tokenized and stored. They can then use Apple Pay to make purchases at all NFC-enabled credit card terminals with just a tap of their phones. Apple Pay’s primary competitors are Samsung Pay and Google Pay. Tim Cook is the CEO of Apple, whose headquarters are located at 1 Infinite Loop, Cupertino, California.

Apple Pay Review Table of Contents

• Costs & Contract: Apple Pay is free for users.
• Complaints & Service: Apple Pay has received generally positive reviews from experts and users.
• BBB Rating: Apple Pay does not have a profile with the Better Business Bureau at this time.
• Sales & Marketing: Apple Pay comes pre-installed on iPhone 6 and later models as well as on the Apple Watch.
• Rates & Fees: How Merchants Can Get The Most Out Of Apple Pay

Apple Pay offers a mobile payment processing service similar to Google Pay and Samsung Pay

Should You Trust Apple Pay?

Lawsuits, Reviews & Complaints

Complaint Summary

Largely Positive Feedback

Many positive Apple Pay reviews mention its ease of use, powerful security features, and all-around convenience. Most expert reviewers acknowledge that it is a useful payment method and that it operates as advertised, but they also consistently cite a lack of participating locations as a major drawback. Several Apple Pay complaints echo this frustration, and many wish the service was available in older iPhone models.

Room for Improvement

Most reviewers still see loyalty card integration as a major opportunity for improvement, and it appears that there is some inconsistency with how Apple Pay interacts with different terminals—e.g., tip interfaces and “confirm payment” prompts. There have also been reports of users who use Bank of America cards being double-charged through Apple Pay, but it appears that this glitch has been corrected. Additionally, there have been complaints of poor performance when making in-app purchases.

More Reviews to Come

Since Apple Pay is bundled with the Apple Wallet app, it does not have its own profile in the App Store. Since NFC payments have yet to gain traction in the payments world, it is likely that more consumer reviews will appear in the coming years.

Apple Pay Lawsuits

We have not found any outstanding class-action lawsuits or FTC complaints filed against Apple Pay. There have been a number of Apple Pay patent lawsuits, but the company continues to win these or they get dismissed. Dissatisfied merchants who wish to pursue a non-litigious course of action against the company should consider reporting it to the relevant supervisory organizations.

In early 2020, Apple agreed to pay up to $500 million to settle litigation associated with intentionally slowing down older versions of iPhones to incentivize users to purchase new products or batteries.

Apple Pay Customer Service Options

Apple hosts a dedicated customer service page for its Apple Pay service for users to troubleshoot issues with using the features and reviewing security and privacy concerns. However, speaking with a customer service representative must be done through Apple’s general customer support services.

Is the BBB Rating for Apple Pay Accurate?

Better Business Bureau Profile

See Which Processors Offer No Monthly Fees And No Contracts.

No Dedicated Profile

The Better Business Bureau does not maintain a profile specifically for Apple Pay at this time. We therefore will not factor a BBB rating into our review at this time.

How Expensive is Apple Pay Service?

Rates, Fees, and Contract Terms

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Cost Summary

Simple To Use

Apple Pay offers one of the simplest transaction experiences of all smartphone mobile wallets currently on the market. The process is as follows: Customers simply hold the phone against an NFC-compatible terminal, place one finger on the iPhone’s home button when prompted, and wait for the transaction to finish. The entire process only takes a few seconds and doesn’t require the user to unlock the phone, select a card, enter a PIN, or type in card information. Apple Pay does not charge a fee for debit transactions though a rate of 3% applies to purchases made with credit cards.

Touch ID Feature

This ease-of-use is made possible by the iPhone’s Touch ID feature, which verifies the user’s identity using a preauthorized fingerprint. In theory, this makes it impossible for Apple Pay to process a payment unless the phone’s approved user is holding the device. As a result, the user can set a default card for all transactions and trust their iPhone to automatically interact with any NFC-enabled payment terminal, since no payments will occur without the user’s fingerprint.

Secure Apple Watch Use

Apple Watch users can utilize Apple Pay by double-tapping the watch’s side button and holding the watch up to a contactless terminal until the transaction is complete. Upon initial setup, Apple Watch owners will be prompted to set a PIN in order to access the Apple Pay app. Then, each time the watch is removed from the user’s wrist and then put back on, the user will need to enter this PIN in order to use Apple Pay. This helps to prevent unauthorized use of the app while also limiting the number of times a user has to enter his or her PIN.

Widely Compatible

Apple Pay is also compatible with nearly all major card issuers, including American Express, Bank of America, Capital One, Chase, Wells Fargo, Citibank, Barclaycard, Navy Federal Credit Union, PNC, USAA, and US Bank. Many regional banks and credit unions are also supported (full list here), but not every card-issuing bank is compatible with Apple Pay at this time.

Loyalty Card Integration

The only major feature that Apple Pay lacked previously was the ability to store and track loyalty cards. Apple Pay loyalty card support now exists for a number of retailers, including JCPenny, Walgreens, and various restaurants.  Apple Wallet allows users to store their loyalty cards in their phones, and Apple Pay can now automatically apply discounts linked to these cards for several, but not all, merchants.

Solid Security Measures

In terms of security, Apple Pay requires the fingerprint of an authorized user or a PIN in order to process a payment, making it impossible for a thief to commit fraud unless he or she can somehow deceive the fingerprint scanner or guess the user’s PIN. In addition to the identification required for each in-store transaction, Apple Pay will allow users to remotely deactivate their Apple Pay accounts in the event of theft. This is a secondary countermeasure against unauthorized users making one-touch in-app or online purchases with Apple Pay. This kind of feature compares favorably to our list of processors with the best merchant services.

Tokenized System

If a thief obtains access to the user’s phone, the user’s credit card details will not be compromised because Apple does not store the card data itself on the device. Instead, Apple Pay tokenizes each card’s data, replacing it with a chain of letters and numbers that is itself meaningless but can be decoded by Apple and the card networks. So if the actual token itself is somehow intercepted, it will be worthless to the fraudster who has obtained it.

Apple stated that it will not save or share users’ transaction information, although this claim is nearly impossible to verify.

Apple Pay uses advanced tokenization to protect its payments

Does Apple Pay Use Deceptive Marketing?

Advertising & Sales Strategy

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Key Points

Straightforward Free Service

Apple markets Apple Pay as a free service for anyone with a compatible iPhone. Apple Pay comes pre-installed on compatible Apple devices, but users will need to add their payment details to the app in order to activate it. The service is free for iPhone users, so it doesn’t even seem possible for Apple to somehow misrepresent its costs in its advertising. This compares favorably in its category to our list of best credit card processors.

The Next Generation of Payment Processing

Like all other products that Apple offers, the company predicates its marketing of this service on its innovative nature. Cut from the cloth of its typical “the future is now” marketing approach, Apple Pay is marketed as a method for payment processing that is already becoming ubiquitous, making traditional merchant accounts all but obsolete. The service is beneficial for merchants who are not charged a fee for debit transactions while credit card payments are charged a flat rate of only 3%. One component of the service is its reliance on NFC technology which allows customers to use their iPhones to process payments. This requires merchants to use payment processing terminals that are NFC compatible, though Apple Pay does not provide that hardware to merchants at this time.

Does Apple Pay Deserve Your Business?

Review Summary & Our Thoughts

A Decent Mobile Wallet Choice

Apple Pay may not be the most compatible or innovative mobile wallet available, but it is the first mobile wallet to compete with actual credit cards in terms of convenience and security. While it is not currently competitive with other mobile money transfer apps, its design and ubiquity position it nicely within the mobile payments arena. We will be updating this review as more information becomes available.

About The Author

Phillip Parker

Phillip is a research analyst specializing in merchant services and credit card processing. He has nearly two decades of experience in card payment services, both as a former employee and as a professional business finance journalist. Phillip has written over 1,000 articles and reviews regarding payment services and the merchant account providers that market credit and debit card processing products and services to U.S. and Canadian businesses.  In addition his contributions here, Phillip has also been quoted in several major publications such as The Los Angeles Times, INC Magazine, Miami Herald, Computer World, and numerous others.

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Phillip Parker

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