Apple is set to open its iPhone’s NFC payment chip to third-party developers, marking a significant shift in how the company handles contactless payments. Starting with the release of iOS 18.1 later this year, third-party developers will be able to integrate their own payment solutions directly into iPhone apps, bypassing the need to rely solely on Apple Pay. This change is part of a broader effort by Apple to expand the capabilities of its devices while maintaining control over the security and user experience.
The decision comes after growing pressure from regulators and competition in the digital payments market. Apple’s move will allow banks, retailers, and other services to offer their own payment options within their apps, potentially reducing their dependence on Apple Pay. However, developers will need to obtain special entitlements and enter into commercial agreements with Apple, including paying fees, to access these capabilities. This new feature will initially be available in a select number of countries, including the United States, the United Kingdom, Canada, Japan, and Australia, with plans to expand to other regions in the future.
The introduction of this feature will also allow for a wider range of contactless transactions beyond payments, such as digital keys for cars, homes, and hotels, as well as transit passes and ID cards. Developers will be able to set their apps as default for contactless transactions, allowing users to initiate payments or other NFC-based interactions with just a double-click of the iPhone’s side button.
This move is seen as a way for Apple to appease regulators while still maintaining a degree of control over the iPhone’s ecosystem. The company has been under scrutiny for its strict control over the App Store and its 30% commission on in-app purchases. By allowing third-party payment systems, Apple may alleviate some regulatory pressure while still ensuring that it benefits financially through the fees charged to developers.
While this development opens new opportunities for developers and consumers alike, it also raises questions about how Apple will manage security and privacy concerns. The company has a reputation for prioritizing user privacy, and any third-party payment systems will need to meet stringent security requirements to gain access to the iPhone’s NFC chip. Developers interested in using these new APIs will need to adhere to Apple’s standards, which include compliance with industry regulations and meeting Apple’s security and privacy criteria.
As Apple prepares to roll out this update, the tech industry is watching closely to see how it will impact the broader mobile payments landscape. With more options available to consumers, the market could see increased competition, potentially leading to innovations in payment technologies and services. However, the fees imposed by Apple may also become a point of contention for developers who are already concerned about the costs of doing business on the platform.
The rollout of iOS 18.1 is expected to begin later this year, with developers in the supported regions gaining access to the new NFC capabilities shortly thereafter. This update marks a significant evolution in Apple’s approach to third-party integrations and could signal a new era of competition and innovation in the digital payments space.
