Monday Headlines: Apple to Compete for Payments Biz Posted by AVCU on 9:24 AM

A lot of media headlines this morning are focusing on a new potential player trying to squeeze into an already crowded payments industry – Apple Computer. Yes, makers of the ever popular iPhone, iPad, and i”Everything else.”

Apple’s plan would reportedly turn consumers' iPhones and iPads into wallets, with consumers waving the devices at payment terminals or paying for items through their iTunes accounts. If that caught on big time, it could have ramifications for credit card companies, financial institutions, and interchange, said an analyst featured in a ComputerWorld article Friday. Press reports are that Apple plans to embed near-field communications (NFC) technology into its next generation iPads and iPhones.
Esteemed Gartner Research believes that Apple's entry into the electronic payments fray would disrupt the mobile payment industry. Its enormous base of 160 million iTunes users gives it the ability to act as its own closed payment system, with little need to interface with credit card companies and financial institutions. It could shut out credit card companies in much the same way that PayPal does in its field. The extent of a financial institution’s involvement in an Apple mobile payment system might be limited to iTunes users using credit cards and banking accounts to fill up their iTunes accounts. The same Gartner researcher predicts that Apple could cut out middle men like Visa and MasterCard. Going beyond PayPal’s closed payments system, Apple has the advantage of having a physical device in people's hands.