Does Apple charge anything for the transaction?
I'm REALLY curious about this. Will they charge a transaction fee and have it as another revenue stream for them (like iTunes/App store)? Or is it going to be another commoditization of their competitor's/partners products in order to move more hardware (like iMessage). If it's the latter that would be a HUGE deal. I just can't imagine they would be able to resist taking a slice of that $12 billion/day transaction pie, though.
The implication from Tim was that Apple was not trying to make money off of this. He said that ApplePay would be successful because competitors tried to turn it into a profitable system for them, instead of focusing on making it work.
For the online version they seem to work with stripe et.al. And not charge anything.
Looks like Apple's commission is ~15-25 BPS for participating banks (from those banks):
"The biggest “surprise” over last 2 months is that Apple has squeezed 15-25bps from the 5-6 participating banks at launch (C, BAC, COF, JPM, Amex and perhaps WFC)."
In finance, 1 BPS is 1/100th of a percent. So Apple could be pocketing ~0.2% on all transactions.
The US does about $12B in card transactions per day. This means that for every 1% of US transactions it captures, Apple could add ~$80M to the annual revenue which is a very small amount against its $140B revenue. Yes there are international markets, but still this is not done for profits by itself.
Basis points, or 1/100th of a percent
I think this business can eventually become larger than the iTunes if they execute it well.
I couldnt find any information on whether Apple pay users can use this for online purchases or not. If they do this may be their next move will be to naturally be the Paypal competitor.