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Apple Pay smartphone payment transaction

Even if Apple Pay is not yet released on the market, many rumors have spread that this will provide exceptional security environment for in-store dealings. Due to immense data breaches that grind down trust for credit card payments and keep on hitting retailers, we better take a closer look at the on-board security features this new payment method will provide.

What’s the difference between Google Wallet and Apple Pay?

Some people may ask if Apple Pay is just another version of Google Wallet. This could be possible since Apple Pay is acting like a virtual wallet as well.

Just like Google Wallet, Apple Pay too utilizes NFC technology to wirelessly allow mobile payments and pair devices. Both of these services permit users to swipe modern smart devices over compatible payment terminals to pay for products or services they want to buy in just a few seconds.

So what’s the difference? Well, Google uses NFC technology to conduct file sharing, phone-to-phone interaction and app sharing; while Apple Pay uses NFC mainly to conduct mobile payments.

Does it mean that Apple Pay is safer than Google Wallet?

Apple has launched various tools to fight-off hackers by combining technologies like Secure Element, Touch ID, EMV and NFC. However, safety result is not yet proven since this is not being released in the market yet.

So here’s how these security technologies work:

• NFC. This technology immediately makes payment process more secure. With Apple Pay, card swiping during transactions is no longer needed. As a result, criminals can’t use their proven techniques like memory scraping and skimming at PoS terminals to reach in your pocket.

Biometric validation. This process is similar to “tap to pay” feature which is already presented in Android devices. This is used to pay anywhere where payments without a contact are accepted. When it comes to Apple devices, their Touch ID feature unlocks iPhone using fingerprint identification, which is required for making purchases in App Store and more. This process is now also used in in-store transactions, which allows users to validate payments at NFC-enabled payment terminals.

Tokenization. Google Wallet and Apple Pay have assigned one-time tokens to every transaction and unique 16-digit numbers for devices to each credit card number. Thus, attackers can’t track your credit card number. And even if they do, they can’t use it outside the modern payment system of Apple.

Secure Element. Apple assigns unique device account number which is stored and encrypted on a dedicated chip inside the device called Secure Element. They also provided a unique cryptogram for every transaction. Encryption key will provide one-time string of random numbers which is decrypted by the network. Once deemed genuine, this will be sent to the bank. The bank then decrypts the token, and once everything is checked out, purchase will be approved.

EMV. This technology is responsible for encrypting transaction from “end to end.” Compared to the magnetic strip, EMV is considered more secure since the former is too obsolete: it was developed around 50 years ago. However, the magnetic strip technology didn’t loose its popularity yet and still is widely used in the United States.

The limitations of new Apple Pay system:

1. Users have to own newest model of Apple Watch or iPhone.

2. Their service is only available to United States citizens.

3. Merchants or Apple will not store the data of credit card users on their servers, meaning users will have more privacy. However, storing users’ data on their devices can potentially increase cases of identity theft.

4. Unfortunately, the NFC chip is limited to mobile payment platform.

5. The technological impediments disallowed merchants from fully supporting NFC. This is where the Google Wallet adoption rate has encountered stern problems.

Is it worth it to replace Google Wallet with Apple Pay?

If you are a US citizen who owns the latest Apple Watch or iPhone, then the answer would be yes. You can use Apple Pay since this apparently would be the next big thing, especially now that over 220,000 stores and banks already planning to implement it.

What about you? Will you prefer Google Wallet or new Apple Pay? Tell us in the comments section.

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