Apple Pay Launches

Published: 24/07/2015

The march of progress takes another step this month with the launch of Apple Pay. Everyday Legal looks into this launch to bring you all the information you’ll need to be part of this technological revolution – particularly whether there are any legal points you’ll need to be aware of if you take up this new service. Read on to find out more about this game-changing new development!

What is Apple Pay?

It’s a new, contactless method of payment which will be available anywhere where contactless payments are accepted. It’s been available in the US since last October.

How does it work?

Apple Pay is available to iPhone 6, iPhone 6 Plus and Apple Watch users when paired with these iPhones and also iPhone 5, iPhone 5c and iPhone 5s phones. Also, when you’re paying for goods and services within apps then Apple Pay is compatible with iPhone 6, iPhone 6 Plus, iPad Air 2 and iPad mini 3.

To get started you’ll need to set up your ‘digital wallet’. To do this you’ll need to link the credit or debit card you’ve added to your iTunes account, plus any other cards you choose, to your Apple device’s Passbook by entering the card security code.

Once your digital wallet is set up you’ll simply hold your iPhone (or other device) near the contactless reader whilst keeping a finger on Touch ID (with an Apple Watch you double click the side button and hold the face up to the contactless reader).

Is there a transaction limit?

The current transaction limit for contactless payments in the UK is £20 until September when the limit is due to rise to £30. The amount you can spend on Apple Pay depends on the retailer.

How safe and secure is Apple Pay?

Security is a concern with recent research showing that 42% of users saying this was the reason why they worried about adding card details to their phone. There are a number of security features which offer some reassurance:

1. When adding card details the actual card numbers aren’t stored on the device, nor on Apple servers. A unique Device Account Number is assigned, encrypted and securely stored in the Secure Element on your device. Each transaction is authorised with a unique dynamic security code with a new one generated each transaction.
2. Anyone using Apple Pay is encouraged to download the Find My iPhone app. If your Apple device is lost or stolen the ‘Lost Mode’ (activated by the app) will suspend Apple Pay or wipe your device completely.
3. You can stop the ability to make payments from credit and debit cards on your iPhone, iPad or Apple Watch with iCloud by logging into iCloud.com and clicking on ‘Settings’.

Where can I use Apple Pay?

At launch over 250,000 locations will accept Apple Pay. Most retailers that have contactless payments will accept Apple Pay.

Will Chargeback and Section 75 rules apply to Apple Pay payments?

The UK Cards Association has confirmed that if you need to claim a refund from your card provider through Section 75 or Chargeback for an Apple Pay transaction you’ll be able to do this. At this time it isn’t clear whether the same protection will also cover in-app purchases made through Apple Pay but there will be more information once Apple Pay launches.

Section 75 of the 1974 Consumer Credit Act say that if you buy something on your Credit Card costing between £100 and £30,000 the card company is jointly liable with the retailer so if something was to go wrong you could get your money back.)

(Chargeback works in a similar way to Section 75 on both debit and credit cards – it has no minimum amount except on Mastercard where it’s £10.)

Content correct at time of publication