Payment Security, Authentication Key Concern for Apple Watch Users

A few days ago, Apple made several big announcements including the upcoming launch of the company's new contactless payment technology Apple Pay in October, the US release of iPhone 6 and iPhone 6 Plus on September 19 (pre-order available on September 12), and the unveiling of the brand new Apple Watch which will be available in early 2015. Both Apple iPhone 6 and Apple Watch will allow users to make purchases using Apple Pay. In addition, the company is making Apple Pay APIs available to developers in iOS 8 so that they can incorporate Apple Pay into their iPhone 6 and iPhone 6 Plus apps.


Image Credit: Apple

One of the big questions that arose after the unveiling of iPhone 6 and the new Apple Watch involves payment security. How secure are Apple Pay payments?

One of the key factors of Apple Pay security involves the implementation of Near Field Communication (NFC) chip technology. Both iPhone 6 and Apple Watch are equipped with NFC chips. The Gartner IT Glossary describes NFC as:

"Near Field Communication (NFC) is a wireless technology that enables a variety of contactless and proximity-based applications, such as payments, information retrieval, mobile marketing and device pairing. It has an operating range of 10 cm or less using the 13.56MHz frequency band. There are currently three user modes defined for NFC operation: 1) Card emulation, 2) Tag reading, and 3) Peer-to-peer (P2P)."

Smartphone manufacturers such as Samsung and Motorola have been incorporating NFC technology in many of the Android devices they produce for quite some time. However, Apple received a patent back in 2012 for the way the company has implemented NFC in their products. Apple's implementation of NFC may be considered by some as breakthrough technology.

While Apple highlighed the implementation of NFC in both iPhone 6 and Apple Watch at the Apple special media event this past Tuesday, there was no explanation given at the event for how the Apple Watch would authenticate purchases.

iPhone 6 allows Apple Pay to be used to make purchases and each purchase can be authenticated via Touch ID. The Apple Watch on the other hand, does not have Touch ID, so how will the Apple Watch authenticate purchases? The answer to this question was answered by several news outlets shortly after the event and also answered specifically in this tweet:

The Apple Watch uses a combination of pin number and skin contact sensors to authenticate Apple Pay purchases. A pin number is entered by the user when the Apple Watch is first put on the users' wrist. Once the watch is on, the skin contact sensors can detect when the watch is removed. When the user puts the watch back on their wrist they have to re-enter the pin number. It is also possible that Apple may enable two-step Authentication for Apple Watch users in the future; requiring anyone who would like to use Apple Pay for store purchases to own both an Apple iPhone 6 and an Apple Watch.

For more information about Apple iPhone 6, Apple Watch, and other Apple products, visit the official website.

See also ProgrammableWeb's article about Apple Watch support of Third-Party apps, article comparing Apple Watch to Fitbit, and article about Apple debuting 4,000 APIs for iOS.

Be sure to read the next Payments article: Today in APIs: ModoPayments Receives Patent, Offers API