NFC-Empowered Apple Tap: Will Near Field Communication Enhance Person-to-Person Transactions?
In the rapidly evolving world of digital payments, the landscape of near field communication (NFC)-based peer-to-peer (P2P) payout capabilities varies significantly by brand and market. This diversity stems from differences in technology integration, device compatibility, transactional limits, and payment infrastructure accessibility.
Apple's latest offering, Apple Tap to Cash (Tap to Pay on iPhone), is making waves in the industry. This innovative technology uses NFC-enabled iPhones to facilitate merchant and user payments directly without additional hardware, revolutionising retail transactions. However, its primary focus remains on merchant acceptance and retail NFC payments, rather than direct P2P payout capabilities.
Apple Tap to Cash benefits from a strong hardware ecosystem, with iPhones leading NFC retail transactions in markets like the U.S. P2P payments within Apple Pay Cash, a combined wallet and virtual card-like service, are device-to-device but occur within Apple's ecosystem rather than direct NFC tap payouts to peers[2].
On the other hand, Samsung Pay Cash employs both NFC and MST (Magnetic Secure Transmission) technologies to support extensive payment terminal compatibility. Like Apple, Samsung Pay Cash is limited to its device ecosystem. P2P payouts and transactions occur within the app, but direct NFC-based P2P payout between users is generally routed through account transfers rather than instant NFC taps[1][4].
Meanwhile, Venmo and Cash App are predominantly app-based P2P wallets that prioritise easy, social, and instant money transfers via internet/mobile data. They focus on quick transfers between accounts, often linked to bank accounts or cards, and offer cashing out funds through direct deposits or card transfers rather than direct NFC tap payouts[4][5].
Looking ahead, potential future solutions in NFC P2P payouts aim to leverage the widespread NFC infrastructure present in smartphones and merchant POS terminals. The integration of NFC-based P2P payments is constrained by device types, and the need to bridge existing stored-value or bank-based account systems with frictionless NFC peer transfers. Some innovators focus on combining NFC with Bluetooth Low Energy (BLE) or QR codes to enhance P2P usability beyond store payments[3].
However, barriers remain due to infrastructure costs, device dependency, and regulatory limits, especially in under-resourced or less developed markets. As the industry continues to evolve, it's crucial to bridge these gaps and create a seamless, universal P2P payment experience.
In June 2024, Craig Federighi, SVP, Software Engineering at Apple, introduced Apple Tap to Cash during the keynote. Visa also announced the addition of Tap to P2P - a P2P payment solution through tapping mobile devices, indicating that other providers may follow Apple's lead in implementing this technology[6].
In conclusion, the main variation in NFC-based P2P payout capabilities is device and ecosystem dependency. Apple and Samsung leverage tight integration with their devices to enable NFC retail transactions and wallet-to-wallet transfers, but direct P2P NFC tap payouts remain niche or emerging. In contrast, Venmo and Cash App prioritise app-centric, internet-based transfers without NFC tap-to-pay for P2P. Future solutions are likely to combine NFC with other technologies (BLE, QR) to broaden reach and simplify payouts across diverse user bases and devices.
[1] Samsung Pay: https://www.samsung.com/global/galaxy/apps/samsung-pay/ [2] Apple Pay Cash: https://www.apple.com/ios/app-store/1374324306 [3] NFC P2P Payment: https://www.nfcw.com/2019/04/22/118929/nfc-p2p-payments-promise-simplicity-but-face-challenges-in-market-adoption/ [4] Venmo: https://venmo.com/ [5] Cash App: https://cash.app/ [6] WWDC24: https://developer.apple.com/wwdc24/ [6] Visa Tap to P2P: https://usa.visa.com/dam/VCOM/download/about-visa/visa-newsroom/visa-news-articles/Pages/visa-announces-tap-to-p2p-contactless-peer-to-peer-payments.aspx
The technology integration in Apple Tap to Cash and Samsung Pay Cash focuses on enabling retail transactions, but they both remain limited to their respective device ecosystems for P2P payouts. On the other hand, Venmo and Cash App prioritize app-based P2P transactions, rather than direct NFC tap payouts. Future solutions aim to combine NFC with technologies like Bluetooth Low Energy (BLE) or QR codes to broaden the reach and simplify payouts across various user bases and devices.
