Secure Intent and the Secure Element

Undistracted John Gruber on Secure Intent on Apple Devices. A interesting dive into spoof proof secure intent: “a physical link—from a physical button to the Secure Enclave…used to confirm user intent during Apple Pay transactions,” and how it plays out on Apple devices with Face ID and Touch ID. He makes a good case for multi-sensor biometric authentication. What interests me most however is the secure intent mention in Apple Pay component security Secure Enclave section:

On Apple Watch, the device must be unlocked, and the user must double-click the side button. The double-click is detected and passed directly to the Secure Element or Secure Enclave, where available, without going through the Application Processor.

Apple doesn’t spell it out but this is confirmation that a GlobalPlatform licensed Embedded Secure Element is simply part of every Apple Silicon package, and for all Secure Intent purposes indistinguishable from the Secure Enclave. If push comes to shove over governments trying to force Apple to ‘open up’ the NFC chip, the counter argument will be that the NFC chip is open for Core NFC purposes but the Secure Element cannot be open because it’s part of the Secure Enclave on proprietary Apple Silicon.

Given that Apple added the Secure Intent section to Apple Platform Security very recently, expect to hear more at WWDC21 in connection with secure payments and UWB.

‘Say Apple Pay’ is going away

The success of Apple Pay lies in its consistent and well integrated UI that hides complexity from users. There are limitations however, and users are bumping up against them the more they use Apple Pay and the increasingly complex Wallet. This happens with fellow gaijin in Japan unfamiliar with the JP mobile payment landscape and history. The differences are outlined in detail here but all you need to know is that at it was first conceived ‘say Apple Pay’ = the default Apple Pay card. This was short-circuited by the addition of Express Transit in 2016 for Suica, a new kind of default card that trumps the old one, that has been a problem on OMNY transit gates for manual swipe legacy MetroCard users.

The basic issue is outlined in FeliCa Dude’s tweet: when Wallet has multiple EMV cards, iPhone doesn’t know which EMV PSE (Payment System Environment) to present to the reader…the digital equivalent of card clash. The user has to manually select one. It’s one of the reasons why the Ventra system is open loop for plastic contactless plastic cards and Apple Pay without Express Transit, but not for EMV Express Transit. Instead Ventra uses closed loop EMV for Apple Pay Ventra, but EMV open loop vs EMV closed loop will always be an uneasy mix on the same system.

Officially Apple Pay only has single default payment card, the ‘say Apple Pay’ card. Unofficially you can have one payment card, one EMV Express Transit card, and multiple native Express Transit cards: one Suica, one PASMO, one Octopus, one Clipper, etc. Saying Apple Pay doesn’t work when there are multiple default cards.

This is going to get worse when Apple finally releases Apple Pay Code Payments which have been in internal testing since the first iOS 14 betas a year ago. We might see some Code Payment details during WWDC21, and I am sure that we will see more UWB Touchess action. Either way the days of saying Apple Pay are numbered. What kind of Apple Pay? NFC, QR or Touchless? And which default card? I’ve said it before and say it again:

There is one more interesting role that Apple has planned for UWB…one that promises to improve the entire Apple Pay and Wallet experience: communicating with the reader before transaction to select the right Wallet card for the job, at a distance, for a truly smart Wallet app. With national ID cards, passports and more coming to Wallet at some point, UWB could be the Wallet reboot we really need.

‘We really need a Wallet reboot’ is on full display with recently refreshed Apple Pay webpage with Wallet getting a whole separate page because Wallet holds many kinds of cards: payment, transit, reward, student ID, passes and card keys. There are some interesting branding tweaks that suggest some changes coming with iOS 15. The first one is the change from Express Transit to Express Mode. This brings it in line with Student ID which has been called Express Mode all along as it opens doors, like a transit gate, and pays for stuff, like Suica and Octopus. Express Mode/Transit debuted with the iOS 10.1 Apple Pay Suica launch in 2016, the Japanese UI uses the term Express Card which is a better fit as the Suica is more than just transit. Hopefully this is just a teaser for WWDC21 and iOS 15.

The VISA JP Apple Pay announcement and digital banking wars

MacRumors Sami Fathi: Customers with Visa cards…will be able to add their card to their Wallet on iPhone and Apple Watch.

Me: I like MacRumors but the writer here has no idea what the story is or that users have been using these cards in Apple Pay all along for store purchases.

MacRumors Sami Fathi: Hey! Could you elaborate on what you mean? Visa cards issued by those banks now have Apple Pay, correct?

Sure Sami, here’s the elaborate story. Do you know FeliCa? It’s the Sony created NFC standard that has been around a long time, long before EMV grafted NFC into contactless credit cards. When mobile payments launched in Japan back in 2004, Mobile FeliCa was the only technology that worked. So mobile payments for all major credit cards and Suica were built on Mobile FeliCa, the contactless payments infrastructure in Japan grew from that.

Fast forward to 2016. Phil Schiller announced FeliCa for iPhone 7 at the keynote and the launch of Apple Pay in Japan. VISA Japan didn’t sign an agreement with Apple but it didn’t matter much because VISA JP cards were available for Apple Pay thanks to previous Mobile FeliCa agreements covering the iD and QUICPay networks for store payments. The other card companies (Mastercard JP, JCB, American Express JP) signed with Apple.

It was a big success. But the Mobile FeliCa agreements only covered store purchases, they didn’t cover things like in-app purchases. Even though many Japanese users added their VISA cards to Apple Pay they couldn’t use them to recharge Suica cards because in app purchases were not supported.

Fast forward to 2020. VISA JP is a major sponsor of the Tokyo Olympics showering sponsorship money to promote ‘VISA Touch’ EMV contactless cards. They want customers to use VISA Touch at stores, not iD and QUICPay because the margins are nicer and EMV contactless is a world standard except for places like Japan (FeliCa) and China (PBOC). Most of the POS equipment in Japanese stores is multi-protocol ready so the customer NFC flavor is a moot point. For whatever reason, let’s say marketshare, VISA JP finally signed on with Apple Pay. The first indication something was up occurred in November when VISA suddenly appeared, and disappeared in the Wallet add card lineup.

What changed for all those VISA JP cards already working in Apple Pay Wallet these past few years? A VISA logo, in-app payments, dual mode NFC and Payment card Express Transit:

Did you get that Sami? Hello, anybody there?

Digital Banking Wars
Seriously though, it’s sad when tech writers don’t understand the story in the stories they write. All major Apple sites ran the same wrong story, it should have been: Visa JP Cards now fully support Apple Pay. Journalists do everybody a great service when explaining complex stories and connecting the dots in easy to understand ways, unfortunately nobody cares about getting it right. Which is a shame because there were other major things going on behind the VISA JP Apple Pay announcement that even the Japanese tech media missed: the very same day, NTT Docomo and MUFG announced a joint digital banking venture.

Let’s take a closer look at that VISA JP Apple Pay announcement, specifically the issuer launch list: APLUS, Cedyna (SMBC Financial), SMBC, Docomo, MICARD, Saison, JACCS, Rakuten. Do you see MUFG? Nope. MUFG brand VISA cards will join at some point, probably, but as VISA has put all their eggs in the SMBC basket, the companies are not on the friendliest of terms.

NTT Docomo and SMBC/VISA group feuded for years and called a stalemate. It was only a matter of time before NTT Docomo kicked SMBC to the curb, which they did yesterday with the MUFG joint announcement. Docomo and MUFG are going to leverage dPoint into an economic zone to rival Rakuten and SMBC/VISA V Point. It’s as simple as that. And here you thought that VISA JP announcement was only about Apple Pay. Think again, the economic zone mobile digital banking wars are just getting started.

SMBC VISA cards are EMV/FeliCa dual mode in Apple Pay but single mode EMV in Google Pay

BIC CAMERA VIEW Suica reward point math

If you use JR East regularly a BIC CAMERA VIEW card is the best investment you can make. So I was pleasantly surprised when the Crecolle (credit-kore) site posted a very useful piece about using Bic Camera VIEW card and Apple Pay. I love it when Japanese credit card sites analyze every reward point possibility in detail. The deep dives are always surprisingly useful.

BIC CAMERA VIEW is a dual function card that grafts a VIEW credit card with a Suica. The Suica part works just like any plastic Suica. The only difference is that users can setup the VIEW card part to auto-charge the Suica part at a VIEW kiosk, they can also setup the VIEW to auto-charge a completely separate plastic Suica, very handy. BIC CAMERA VIEW is also a BIC CAMERA store point card. When you add it to Apple Pay only the credit card function is added as QUICPay. The card comes in VISA and JCB credit flavors, mine is JCB so I can recharge my Wallet Suica with Apple Pay.

To test BIC CAMERA POINT reward rates, the Crecolle staff ran 4 purchase patterns with the same battery item:

  1. Apple Pay BIC CAMERA VIEW QUICPay
  2. Apple Pay BIC CAMERA VIEW QUICPay + showing the plastic card for BIC CAMERA reward points
  3. BIC CAMERA VIEW (plastic credit)
  4. BIC CAMERA VIEW (plastic Suica)

The return rates printed on the receipts showed the following:

  1. 1% BIC CAMERA POINTS
  2. 8% BIC CAMERA POINTS
  3. 10.5% BIC CAMERA POINTS
  4. 11.5% BIC CAMERA POINTS

So the lesson here is that if you want maximum points when buying at BIC CAMERA, use the plastic VIEW Suica. Why the big differences? The 8% vs 10% difference is the Apple Pay margin. The #1 and #2 difference between Apple Pay VIEW QUICPay by itself and showing the plastic card is simply that the BIC CAMERA point card is not hosted on Apple Pay as a NFC VAS rewards card. If it was you could do what you do at LAWSON: say ‘Apple Pay’ so that the purchase amount is rewarded via NFC VAS to a dPOINT card or PONTA card in Wallet. The #3 and #4 difference is the benefit of using Suica SF and the JR East Suica float in action bypassing the credit card companies. This last difference is the same force driving endless QR Code payment app campaigns, QR players bypass credit card network margins and pass the benefits to customers.

There is one pattern the Crecolle staff did not test: Apple Pay BIC CAMERA QUICPay and showing the BIC CAMERA App barcode point card, this gives the same 8% but without showing any plastic.

WWDC21 Apple Pay Wish List: new Wallet app

It’s that time of year again, to ponder the mysteries of Apple Pay, Wallet, PassKit and Core NFC in the next major iOS release. I wasn’t planning a list this year because all the things covered last year: UWB Touchless CarKey, QR Code Payments, etc., are still lurking in PassKit calls and internal beta test builds and have yet to see the light of day. And then there is App Clips, a solution that finally leverages the versatility of NFC tags and iPhone NFC with reader mode was the big WWDC20 story, but it didn’t come into focus either. Too many COVID distractions.

No, no, the only thing that mattered to users and developers was this: when will Apple do something about the Face ID with face mask problem? The eagerly awaited iOS 14.5 Unlock with Apple Watch feature will almost certainly be the most popular feature of iOS 15 too. There are some interesting new PassKit tidbits in iOS 14.5: PKRadioTechnology type properties for NFC and bluetooth, the later for UWB Touchless use. This is the same pattern we saw at the end of the iOS 13 cycle with PassKit Secure Element Pass references replacing NFC Certificate Pass.

So what’s on the slab for all things WWDC21 iOS 15 Apple Pay? I have no idea. UWB Touchless and QR payment support lurking in the background might see the light of day, App Clips might get some refinements. Nothing really new. So I asked readers what they wanted for iOS 15 Apple Pay and the answer was clear: a Wallet app reboot. I didn’t think much about it until I saw the list of China T-Union add card Wallet options for mainland China.

The Apple Pay China Transit card list is long and getting longer

More Apple Pay Transit cards are on the way but there’s another problem, digital ID cards (passports, driver’s license, national identity cards, etc.). Apple Pay Student ID MIFARE cards landed back in iOS 12, but Apple has grander plans revealed in a NFC digital ID patent filing. The Japanese Ministry of Internal Affairs and Communications (MIC) has plans for a digital version of My Number Card (Individual Number Card) and is already in negotiations with Apple. Where and how do digital ID cards fit in the current Wallet model that only holds a maximum of 12 cards? Something has to give.

Wallet has a very simple rule: any card that loads a Java Card applet into the secure element has to reside in Wallet, the maximum number depends on how many Java Card applets it can hold at any one time. Any card or developer that wants to loads applets and use the secure element also has to have a PassKit NFC/Secure Element Certificate Pass. This is covered by NDA but a company called PassKit (not Apple) gives us an idea what Apple’s NFC/Secure Element Pass guidelines are:

Apple care a great deal about the user experience. Before granting NFC certificate access they will ensure that you have the necessary hardware, software and capabilities to develop or deploy an ecosystem that is going to deliver an experience consistent with their guidelines.

Yeah, the end to end user experience, the whole reason behind the success of Apple Pay. But the Apple Pay user experience has seriously declined in the Face ID with face mask era. The current Wallet with its card metaphor has reached a wall, stuffing digital ID and Code Payments into the mix along with non-secure element Wallet tickets, boarding passes and reward cards, all using same old card UI, will only break the user experience on top of the Face ID with face mask inflicted damage.

Even if Apple doesn’t add new functions to iOS 15 Apple Pay, they must lay groundwork for a new, flexible and far more useful next generation Wallet app, for adding, storing, configuring and most of all, using an even growing collection of payment cards, transit cards, CarKey, reward cards, passes and digital ID items. Anything to save us from the cacophony of payment services, apps and reward goodies chasing our money and slowing us down at checkout with finding, unlocking, displaying a reward code (if the WiFi connection is good, heaven help those waiting in line when it’s bad) and finally paying. Whew.

The whole point of Apple Pay Wallet was to free us from physical card clutter. After 7 years of Apple Pay and payment apps we have digital clutter that’s almost worse than the original problem that digital wallets and smartphones were supposed to free us from. Let’s get our eyeballs and attention spans back.

Also see: UWB Touchless Express Transit and Apple Pay for iOS 15?