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  • Milos Dunjic

The Power Of Apple Wallet

Updated: Aug 26, 2019

By now, pretty much everyone following my Paydeology blog knows that I am a heavy payments geek. I have been pretty much completely cashless for about 20 years. Payment cards are all I need. I do not rely on my debit card, mainly using credit cards (or my Amex charge card) for most of my general spending whenever I can ... unless, of course merchant only accepts debit or good old cash, which happens rarely here in Canada, but every once in a while. I have to admit ... I do not like money being taken out of my bank account in real time nor handling cash in my pockets, period 🙂


Next, I do not need to rely on debit cards to be disciplined with my spending ... I always pay my credit / charge card statement balances on time and in full ... but I simply love pay later nature of the credit / charge cards ... psychologically it is much easier to accept dealing with potentially fraudulent payment transaction disputes with borrowed money, than with my own ... that's is my main paydeology in a nutshell 🙂


On top of that I am primarily Google platform user, although I am mainly using Apple devices in my private life in last several years. I do like very much having portability of my personal email, contacts, etc. and Google platform clearly gives me that. For example, I have an iPhone, however I do not use Safari, Apple Calendar, Apple Maps nor Apple Mail at all. Instead, I exclusively use and rely on Chrome, Google Calendar, Google Maps and Gmail. Pretty much the same setup is on my Mac laptop.


This way, I can easily switch from my iPhone to any Android phone or from my MacBook to any Windows laptop ... and all of my private emails, contacts, etc will still be there on a new device ... pretty much the same way.


But I kept sticking with Apple devices for years. You may be wondering why. Then I realized ... and it was for one simple app that Apple gave me right from the start that I didn't have on Android ... at least not until very recently ... it's Apple Wallet.


Why Apple Wallet Does It For Me?

The moment I switched from my much beloved Google Nexus to iPhone, I was able to load all of my payment cards, loyalty cards and boarding passes into it and use it for in-store, in-app transactions and my air / train travel. All are securely stored inside iPhone Secure Element and protected by my fingerprint scan. I am able to use it in full offline mode and without any network connectivity.


Android unfortunately did not offer me all that in one simple and very convenient app for a long time.


Although being the very first BigTech out with NFC wallet on the market (way back in 2011), all until mid 2018, Google pretty much struggled to focus, consolidate and define its own mobile ecosystem and overall strategy for the diverse Android hardware platform. Their original NFC solution started as mobile wallet which was able to store only City bank credit card number (no, payment network tokenization wasn't available back then 😒) in Nexus's secure element, plus Google's own prepaid MasterCard card number, that was pre-provisioned in the same secure element (the original Google Wallet launch video from 2011 is available at https://www.youtube.com/watch?v=am8t6iZ7up0 ... watch it, it's very cool).


Since then, all major payment networks launched their payment tokenization services, and Google quickly adopted it, and rightfully so. Unfortunately Google had to address hardware diversity of the whole Android platform as well. Although most of the Android phones have embedded secure elements, not all of them have it though, especially lower end phones. Google did not want to rely on standard SIM cards as secure element, since that meant partnering with telcos (early implementations of banking NFC wallets used SIM as secure element and failed miserably).


That brought us about the Host Card Emulation (HCE) framework, which pretty much eliminated dependency on availability of NXP secure element in the phone and moved payments credentials to the cloud. Although fairly smart conceptually, HCE has hard dependency on available network connectivity (mobile data or wifi), as G Pay and HCE require access to Google cloud services to work smoothly. The HCE is 100% cloud based and needs to frequently refresh its G Pay app protected memory with temporary set of payment credentials and EMV cryptogram keys fairly often. However, when I roam, I like to turn my data plan off. Yes I am one frugal and cheap bastard 😉. Google also stores everything (including complete transaction history) in their cloud and I am still not comfortable with that.


And yet again, although Apple was not nearly as innovative in mobile payments space as Google was, they waited patiently for the standardized ecosystem ingredients to come together, then patiently built their own Trusted Service Manager (TSM), and finally added secure element to iPhone and released accompanying Apple Wallet app ... which, right of the start hit all of my buttons. I was sold immediately. I switched to iPhone and Apple Wallet just worked with all major Canadian card issuer cards, once corresponding payment token got stored in iPhone secure element. No cloud involved whatsoever. In-store and in-app transaction history is only stored in my iPhone secure element ... not in Apple cloud (at least that's what Tim Cook tells us 😉)


Time To Think Switching Back To Android?

Google's own G Pay app had caught up with Apple Wallet on all fronts for a while - same basic features and UX, same underlying tokenization plumbing, most high end Android phones come with fingerprint sensors or facial recognition, and it handles all the same card types as Apple Wallet (and even more, as Apple somehow doesn't support gift cards).


Is it now time to rethink again about switching back to Android?


Unfortunately, since Google’s G Pay still relies on HCE’s ‘cloud based secure element‘ (even in case of latest Google Pixel phones), instead of using embedded secure element chip, for storing payment credentials and transaction history, I am firmly staying with iPhone ... at least for now.


I am sure you have your own reasons why you prefer to use particular mobile phone platform or OS. Don't be shy to share your own views. Always interested to hear it.






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