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Comment by pc | Hacker News Reader

You can't use Apple Pay directly: you have to use it with a supported payment platform. (List is at https://developer.apple.com/apple-pay/.)

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Three of the payment platforms either don't load or show a 'Coming Soon' page. Ouch.

So is Apple Pay in essence another way to get a credit card processed against stripe? If you have an app that customers can store credit cards on, it's not clear to me what the additional benefit of apple pay is? Is it simply a better/faster way of getting the card information to stripe by way of thumb press as opposed to key entered?

With Apple Pay, your physical credit card number is NOT stored on the iPhone 6's secure element; instead, a token is (the token is effectively an alias to your credit card number; it looks like one too - is 16 digits, etc, so will work nicely w/existing payment infrastructure). So there's additional security there. If your iPhone 6 is stolen, you can report it stolen, and the issuing Bank of your credit card will simply invalidate your token. You won't have to worry about replacing your physical credit card. In contrast, if the merchant --- whose app you have your physical credit card number stored within --- is hacked, you'd have to get your credit cards replaced, which is of course more onerous than the former.

Just curious...does Google Wallet also do the same thing?

No, Google Wallet doesn't. When performing a tap & pay at a merchant NFC terminal using Google Wallet with your Android phone (running 4.4+), your Google Wallet Mastercard card is the card-account actually being used vis-a-vis transaction authorization. Then, later, Google will charge your card that you've configured to be your default-payment card. I do not know if Google is fully implementing Mastercard PayExpress spec, but they are implementing some of it at least. Thing is, because Google Wallet is HCE-based, and thus there's no secure element, they cannot permanently be storing the encryption keys needed to generate the cryptogram(s) and such that are part of a standard EMV transaction (Mastercard and/or the issuing banking of your Google Wallet Mastercard - Bancorp[1] would never allow permanently storing the encryption key w/out a secure element).

[1] https://support.google.com/wallet/answer/2676665?hl=en

Interesting. Does this mean that transaction data (what I bought, when I bought) is visible to Google, unlike Apple Pay (claimed)?

Yes, it is.

http://www.google.com/wallet/faq.html#tab=faq-security

I don't know, but I do know that Google Wallet has some kind of 'ghost' credit card number - that's the one that gets sent to the terminal, then presumably Google charges my actual card in the background somewhere.

Care to back that up with sources or a reference?

I suppose the idea would be that you want to lower the barriers to payment and a thumb press is pretty low.

In Europe, we can already pay for things with contactless bank cards, without even tapping (up to about $30). If you want to do it like NFC or iPay, you can always stick your payment card to the back of your phone....

UKCards Association says "44.6 million contactless cards in circulation in the UK, used to make 22.1 million contactless transactions in May 2014". http://www.theukcardsassociation.org.uk/contactless_consumer...

You joke about sticking your card to your phone but that's what my bank did https://www.commbank.com.au/blog/tap-pay-new-commbank-app-io...

We have NFC sim cards in Turkey that enables regular phones (even dumb ones) to make purchases. (http://www.garanti.com.tr/en/personal_banking/credit_cards/b...)

There are also NFC enabled stickers, watches and key fobs.

Wasn't joking ;-)

Even BofA in the USA issued tags that could be attached to the back of a phone (or anywhere else).

That's what I don't understand...why does a NFC transaction have to involve smartphones? What is it that needs the processing power of a smartphone? Is it so that Goog Wallet/Apple Pay can access your transaction data?

In Google's case, yes - access to transaction data is absolutely part of the plan. Apple explicitly set their system up so they don't get that data though.

NFC payments don't have to involve smartphones, but look at what Apple Pay gets you:

- Biometric auth - one-time numbers generated for each transaction - multiple cards in one place - hides your info from the vendor (and apple for that matter)

Those are pretty nice things to get from something that lets me ditch my wallet...

It goes from one click to one depression. it is the mobile equivalent and steps right around amazon's 'patent'

You actually can:

"The alternative is to provide your own server-side solution to receive payments from your app, decrypt payment tokens and interface with the payment provider. Handling credit and debit card payments can be complicated and unless you already have the expertise and systems in place, an SDK from a payment provider is the quickest and most reliable way to support Apple Pay in your app."

From: https://developer.apple.com/apple-pay/Getting-Started-with-A...

... That's not directly. The "interface with the payment provider" is what Stripe is and this lets you interface with Stripe.

What is the barrier in building your own interface with the payment provider? Is it red tape, or technical challenges?

Both. You have to build a pretty significant architecture which meets PCI compliance (so e.g. hardware firewalls, hosted in a data centre with sufficient physical security, etc. etc), which makes it hugely expensive, and technologically demanding. Then you have to sign a contract with a bank or banks in order to get the process going, which is the red tape part. Then you get to handle all the systems responsible for handling fraud, chargebacks, extra customer service, and so on. And then you pay higher rates because you're doing worthless volumes, even assuming that the banks will deal with you at those volumes.

Once you're done that, you've built a small-scale, inefficient, featureless, and altogether shitty version of what Stripe will offer up to anyone with an e-mail address, and it's taken you six to eight months to build. Oh and your app is out of date and all your competitors have taken your customers.

What I meant to ask was, "what did people do before Stripe came into existence"?

There are dozens of payment gateways. Braintree and Authorized.net are two large ones. If you accept credit card payments you will need a payment processor. You don't want to do this yourself.

N.B. The comment you're responding to was made by Stripe cofounder Patrick Collison (pc).

Thanks. Makes sense.

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