Apple's Tap to Pay service for the iPhone has finally arrived in the UK, allowing smaller UK merchants and other enterprises to replace traditional payment terminals at the point of sale.

In a surprise announcement, the company extended the service to UK businesses on July 13. It lets them accept Apple Pay and other contactless payments using an iPhone and a partner-enabled app and is the logical extension of Apple's original plan to make the iPhone (and Watch) replace the contents of your wallet.

First UK payment partners coming on stream

There are numerous payment partners coming online in the UK, including Revolut and Tyl by NatWest. Adyen, Dojo, myPOS, Stripe, SumUp, Viva Wallet, Worldline, and Zettle by PayPal are all on the way.

The service will be made available across the company's UK stores during the next few weeks. Otherwise, the system works with digital wallets and contactless credit and debit cards from the likes of American Express, Mastercard, and Visa.

The rollout of the service in the UK could suggest plans to introduce Apple Pay Later services in the country later on. While  expectations of an international release for Apple Card remain low, acceptance of Apple's technologies across every arm of business is rapidly accelerating.

Tap to Pay on iPhone is already available in the US and Taiwan.

How Tap to Pay on iPhone works

The system is iPhone simple. Once you sign up with a payment provider, you can set up your device to accept payments using that partner's system. To take a payment, you use the NFC chip inside your iPhone to read contactless cards, including credit and debit cards and digital wallets, including Apple's Wallet/Apple Pay.

At checkout, the merchant will simply prompt the customer to hold their contactless payment solution near the vendor's iPhone, and payment is made. No additional hardware is required.

This should be a popular system in the UK, where 99% of retailers already accept Apple Pay. That's far above the rate of adoption in the US, where contactless payments had a slow start.

However, at this point around 40% of US consumers have become accustomed to using these services. Almost 90% of Americans now use some form of digital payments, a McKinsey survey claimed, adding that more than 66% expect to use digital wallets within two years.

These services are also likely to become key components to Apple's bid for business across emerging economies, where access to financial services is not necessarily as open. And always in the background, Apple generates a small torrent of cash from small charges on these payments.

What about privacy?

Tap to Pay on iPhone is designed with privacy in mind. All transactions are encrypted and processed using the Secure Element; Apple doesn't know what is being purchased or who's buying it.

What Apple said

"We've seen Tap to Pay on iPhone transform the checkout experience for so many different types of businesses, and we're thrilled to now support merchants across the UK by offering an easy, secure, and private way to accept contactless payments using the power, security, and convenience of iPhone, with no additional hardware needed," said Jennifer Bailey, Apple's vice president of Apple Pay and Apple Wallet.

"Small and medium-sized businesses have long played a vital role in the U.K. economy, and alongside payment platforms, app developers, and payment networks, we're making it easier than ever for U.K. businesses to seamlessly accept contactless payments and continue to grow their business."

"Today's consumer is a savvy shopper, armed with more product knowledge than ever before," Rodney Bryant, IBM Global Business Services Retail Industry Lead for the Apple Partnership Team, told me in 2017. "The convergence of physical and digital in retail is driving customers' desire [for] a convenient, personalized experience."

Please follow me on Mastodon, or join me in the AppleHolic's bar & grill and Apple Discussions groups on MeWe.