iOS 16 Wallet: expanding the Apple Pay experience, aka Suica auto-charge for the rest of us

iOS 15 added big new features to Wallet, expanding digital keys from cars to include home, office and hotels and ID in Wallet driver licenses for the first time. There were smaller but important UI changes too. A new add card screen offered new categories making is easy to add transit cards regardless of the device region and quickly re-add previous Wallet items from iCloud. iOS 15 was all about Wallet to the extent that Apple now advertises it as a separate thing from Apple Pay with a separate web page, and even referred to Apple Pay as “one of the most important areas of Wallet” in the WWDC keynote. Very interesting.

iOS 16 moves the focus back to Apple Pay and making digital payments more useful, practical and universal. The WWDC22 Keynote announced Apple Pay Later, in-app ID card verification and key sharing. Apple Pay Later is one aspect of several new Apple Pay functions unveiled in the What’s new in Apple Pay and Wallet session.

Multi-merchant payments: In our online world we can never be sure how many sub-merchants are involved when we order something and how our card information is shared. In multi-merchant Apple Pay, multiple payment tokens are issued for each merchant in the same transaction, preserving user privacy, with the iOS 16 Apple Pay paysheet showing a breakdown of each sub-merchant charge. This feature works mostly on the backend, but showcases how smartly the Apple Pay Wallet team design features to ‘just work’ securely for merchants and customers.

Automatic Payments
My favorite iOS 16 feature as it addresses a lot of interesting use cases, much more than just Apple Pay Later installments which fall under:

Reoccurring payments, which include things like installments and subscriptions, basically any regularly scheduled payment. With the recent Starbucks Japan price increases, I decided to sign up for the new JR East Beck’s Coffee Shop subscription plan. Up to 3 cups a day for ¥2,800 a month. A pretty good deal for commuters like me. The Beck’s subscription service is subcontracted out to an interesting online business venture company called Favy that uses Sign in with Apple to create an account. Payment however is manual credit card entry with the onerous, ubiquitous 3D Secure sign-in. Pass issue and serving size selection (M=¥50, L=¥100 extra) is done in Safari. It works well enough, but canceling or getting payment details is a real Safari expedition. It would be a much better, and faster, customer experience doing it all in Apple Pay.

Automatic Reload: this is the real money feature for me because it plays on the classic snag of using Apple Pay Suica…recharge. All pre-paid cards are a catch-22. Japanese users love them because they like the “I know how much money I’m adding to my card” aspect of manual recharge, but there’s the inevitable, you know you forgot about it, bing-bong ‘please recharge’ transit gate alarm when Suica balance is short.

JR East offers Suica Auto-Charge (auto-reload) as a feature of their VIEW card. The auto-charge option works great with Apple Pay Suica but like all transit card auto-charge, it is tethered to the transit gate NFC system. This means the users gets instant, seamless auto-charge but only on the operator’s transit gates. Suica auto-charge does not work outside of the Suica and PASMO transit gates, not at store terminals, not in other transit card regions like JR West ICOCA. This limitation is a big customer complaint, I and many others would love Apple Pay Suica auto-charge to work everywhere.

Apple Pay automatic reload takes care of this problem very nicely. Suica would recharge anywhere because the card balance ‘trigger’ and reload process is done via Apple Pay instead of JR East transit gates and the Suica system. JR East could keep auto-charge exclusive to their VIEW cards as they do now or easily, selectively expand it. Either way they would greatly increase the usefulness of VIEW and Suica by supporting the new Apple Pay automatic reload feature. The possibilities are are pretty exciting.

Order tracking
Another very useful feature I think people will love using. The addition of QR/barcodes in the Apple Pay sheet is a first and will greatly shorten the order pickup~delivery process. The best use case of Apple Pay and bar codes that I can think of.

ID verification in apps
This is where ID in Wallet gets real. Wallet app has TSA airport checkpoint verification built-in but that’s not going to help all the government issuing agencies, not to mention software developers, around the world who want to implement digital ID verification to unlock various digital services.

JR East for example has centered their whole Super Suica MaaS Cloud initiative around ID PORT and the ability to match various region or age based services (discounts, special fares, etc.). In other words JR East and their sub-merchant or local government agency want to know where I live and how old I am. This is all provided on the Japanese government My Number digital identity card launching later this year on Android, and Apple Wallet later on. But I don’t want my personal details going everywhere. If the MaaS campaign app or website only needs to know that I live in Tokyo and am over 60, that’s the only info I want to give them. This is what the new PassKit ID request APIs in iOS 16 do: give apps only the information they need to perform a verification for a service and nothing more.

Key sharing
Nothing big here, but it does address one iOS 15 Wallet shortcoming for home, hotel keys which that could not be shared and expanded share options beyond mail and messages. I’m doubtful Apple includes office keys in the bargain but the fine print reads: available on participating car brands and access properties. We’ll find out when iOS 16 ships.

And then there’s Tap to Pay on iPhone. It’s really not an Apple Pay function to me because it turns iPhone into a very handy and portable NFC payment terminal, but it makes sense branding wise. Just say Apple Pay for making…and accepting payments. Anywhere the merchant has their payment provider POS app and a network connection, they are ready to go. This is big. Apple has lined up an impressive number payment providers in a very short time who are happy to leave all the hardware certification and secure element management to Apple and focus on software. I can practically feel the intense interest from Japan where local payment providers would love to leverage the global NFC capable iPhone for seamless EMV and FeliCa payment services. It could be an interesting Apple Pay year.