Rumours are growing that Apple is considering launching a peer-to-peer (P2P) payments system for mobile devices.
In a development which could disrupt the entire banking industry, the U.S. tech giant is partnering with leading national banks to take on popular payment systems such as PayPal’s Venmo and entrepreneur Jack Dorsey’s Square.
According to recent reports [paywalled], Apple is in discussion with U.S. banks, including JP Morgan, Capital One Financial Corporation, Wells Fargo and U.S. Bancorp, to develop a new platform which could be launched as soon as 2016. It has also been granted a patent for an encrypted P2P payment system which allows transactions between wireless electronic devices, such as iPhones and the Apple Watch.
The proposed mobile system is expected to offer Apple users a way of transferring payments from one account to another just using their mobile device. Although cash transactions lead the way for consumer payments, services like Venmo and Square are rapidly gaining traction among young customers.
Apple has not yet officially released any details on the rumoured payments service, but CEO Tim Cook, speaking in a keynote address at Trinity College, Dublin, hinted at its introduction, saying that Apple Pay will become so wide-spread that “your kids will not know what” cash is.
Apple Pay, the digital wallet service launched in the States last October and this July in the UK, has seen the Cupertino-based firm team up with top banking groups Visa, MasterCard and American Express. Industry experts predict that the service will have a similar impact on the world of banking, as the iPhone had on the smartphone industry.
Facebook has also ventured into the payments industry with a proposed P2P platform integrated in its Messenger app. The system, which is currently disabled on the company’s iOS app, would allow users to register a payment card to Facebook and use the details to transfer money to their contacts.