The news: Apple is reportedly developing technology that will let merchants accept contactless payments using their iPhones, people familiar with the matter told Bloomberg. It's unknown whether it will exist within Apple Pay or launch as a standalone app, but it may roll out in Apple’s upcoming software update.
Key context: Software point-of-sale (softPOS) offerings let merchants accept contactless payments using near field communication (NFC) technology on smartphones and tablets without additional hardware. But softPOS solutions typically run on Android operating systems: Apple restricts third-party payment players from using its NFC technology.
That means if merchants want to accept payments using an iPhone, they need to use a mobile point-of-sale (mPOS) product. These solutions generally run on an app and connect to the device via a dongle, register, or Bluetooth. Block (formerly Square) was a pioneer in the mPOS space.
How we got here: In 2020, Apple acquired softPOS startup Mobeewave for an estimated $100 million. Mobeewave had worked with Samsung to develop its own softPOS solution—so we expected Apple would use the acquisition to do the same.
Apple’s opportunities: The solution would be Apple’s first merchant-facing payments product, which could open a new revenue stream and fuel its broader payments ambitions.
It could bring a new customer base to Apple and help it expand wallet acceptance.
Apple could steal volume from mPOS players.
Go deeper: Check out the Mobile section of our “Payments Ecosystem” report to learn more about mPOS and the emergence of softPOS.