An 'Apple Pay' a Day: Are You Ready for a Virtual Wallet?

An 'Apple Pay' a Day: Are You Ready for a Virtual Wallet?

applepayMaybe you think whipping out a piece of plastic and swiping it at the checkout counter is no big deal. Or maybe you’re that person who always holds up the line because you're fishing for your card at the bottom of your bag.

No matter which camp you're in, Apple is betting they can convince you to adopt a better method. On Tuesday, as part of its unveiling of the new iPhone 6 and Apple Watch, the company debuted its own iteration of a mobile wallet called Apple Pay.

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Consumers will be able to use the service, which will be available on the iPhone 6 this October at a range of retail stores—including Macy’s, McDonald's and Whole Foods. Apple has said its service will be compatible with all the major credit card companies, including Visa, MasterCard and American Express.

Here's how it works: You import your credit card information to your iPhone (or new Apple Watch), and when you're ready to check out at a store that supports Apple Pay, you wave your device near a reader to make the transaction. To authenticate the purchase, you touch your device's fingerprint sensor and your account is charged.

The company contends that using the wallet is actually more secure than paying with plastic, since your credit card information is encrypted on a chip in your phone, rather than on servers.

But the big question remains: Will this actually catch on? After all, Google introduced its own contactless payment system, Google Wallet, back in 2011, and the technology never really caught on—among consumers or retailers—the way the company had hoped, according to The New York Times.

But Apple may have timed the product’s release perfectly: By the end of next year, merchants will be required to change their payment technology to one that adheres to a chip-based smart card. So if enough people demand Apple Pay, retailers may find it an opportune time to upgrade their infrastructure. And market analysts do see adoption coming: Forrester Research predicts mobile payments in the U.S. will hit $90 billion by 2017.

And don't underestimate Apple's power of persuasion: Its expertise at creating enjoyable consumer experiences could lead many people to want to try it out. “Apple is likely able to create a sort of harmonious ecosystem that Google wasn’t able to do,” Forrester Research analyst Denée Carrington told The New York Times.

Not quite ready to make the jump into the world of virtual wallets? Check out these other online tools that can help you take control of your finances.

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