Will Apple, Inc. Launch a Payment Service on the iPhone 6?

Ever since Apple (AAPL 0.53%) CEO Tim Cook started telling investors the company is working on "new categories" for a 2014 launch, the Apple rumor mill has been dead set on finding out exactly what these new categories may be. While much of the buzz has been fixated on the alleged iWatch, there's also been some chatter about a potential payment service -- a rumor that has recently gained further traction. Could payments be one of the new categories Apple will enter in 2014?

Apple's Touch ID is likely a foundational building block for Apple's payment service. Image source: Apple website.

Near field communication?
While Apple marketing chief Phil Schiller stated in 2012 that near field communication, or NFC, technology wasn't likely to be a mass-market solution for the payments industry, Apple management may have reversed their opinion -- at least according to a few sources.

Until the reliable KGI Securities analyst Ming-Chi Kuo predicted last month that NFC technology would likely be included in the iPhone 6, it was largely consensus opinion that Apple would never utilize the technology. And now another report is fanning the flames for NFC on iPhones even further: Apple has allegedly made a deal with China UnionPay to integrate the Chinese company's banking with Apple's iPhone 6 using NFC technology, according to BrightWire (via MacRumors). Further, BrightWire asserts NFC technology will be built in to the iPhone 6.

Despite the recent rumors, it still seems unlikely Apple would actually use NFC technology. Not only does the technology require both device and point of sale infrastructure, but it also necessitates users to hold the device within a few inches of a checkout device. Such physical requirements would seem like a step backward in technology, especially considering Apple's push of iBeacons, which enable a wide range of mobile in-store customer-retailer interaction (without the restraint of a few inches of proximity), including payments.

It's coming
NFC or not, an Apple-branded payments service is likely. Apple has already began the groundwork for an effective service with iBeacons, Touch ID, and Passbook -- not to mention Apple's nearly 800 million iTunes accounts, and an estimated 400 million with a credit card on file.

Apple CEO Tim Cook even admitted in January during the company's fiscal first-quarter earnings call that mobile payments were, indeed, "one of the thoughts behind Touch ID." Cook said that the company has been "intrigued" with payments and that he sees a "big opportunity on the platform."

Further, Re/Code said last month that Apple has been actively pursuing executives to take on roles for a payment service within the company.

The company has been meeting with potential applicants for two new positions at Apple focused exclusively on building a business around the hundreds of millions of credit cards it already has on file. Apple is seeking to fill head of product and head of business development positions, one of these people said. 

"Their ambitions are very, very serious," one of the sources said.

While a payments service might not necessarily evolve into a meaningful profit center for Apple, it could certainly strengthen the longevity of Apple's already "sticky" ecosystem. And Apple's unparalleled seamless integration of hardware, software, and services could give the tech giant a big head start on competitors in launching a useful and game-changing payments service.