The bulky card reader that has defined retail payments for decades may soon become less necessary. Apple is betting that its iPhone can take on many of the functions of a traditional point-of-sale terminal with its expanding Tap to Share system, which allows merchants to accept contactless payments without separate POS hardware.
The technology depends on improvements to the near-field communication (NFC) capabilities built into the iPhone 16, Cult of Mac reports. Earlier iPhone models, including iPhone 14, could be inconsistent when handling certain NFC transactions, particularly when reading metal cards—a limitation that stood out because Apple’s own credit card is made of titanium. The iPhone 16 includes NFC improvements that make those transactions more consistent, allowing Apple to use the technology more broadly in its retail stores.
For years, Apple Store employees processed payments using iPhones paired with external readers. The add-on devices required a Bluetooth connection and a separate battery, creating a bulkier setup for employees to carry and maintain. With Tap to Share, Apple can instead use iPhone 16 devices to handle payments directly.
Waiting for Customers to Catch Up
Apple enabled the NFC capabilities needed for this type of experience two years ago, but wider adoption depended on customers becoming more accustomed to contactless payments and the technology supporting them.
“Tap to Share only supports contactless payments, so cards that don’t have NFC chips can’t be accepted,” said Don Apgar, Director of Merchant Services at Javelin Strategy & Research. “The benefits of integrated technology are lost if there are enough exceptions that still require the old hardware hanging around.”
“The tipping point is on the consumer side,” he said. “Over 90% of credit and debit cards issued in the U.S. are now NFC-capable, and over 75% of consumers have access to a digital wallet, with more than half using a wallet regularly for purchases. The level of NFC enablement at the consumer level means that exceptions are very few and far between—if at all—enabling Apple and other retailers to rely on contactless-only devices like tap to phone while still delivering a premium customer experience.”
Android and Google Are Following Suit
Apple isn’t the only company exploring this direction. Android manufacturers and Google are also developing NFC-based approaches that could enabled similar phone-based payment experiences.
According to Android Authority, Google’s implementation is still being refined, in part because Android devices vary in the placement of their NFC chips. That means users may have to position phones more carefully when competing transactions.
The growing interest in phone-based payment systems suggest that dedicated payment hardware may become less central in some retail environments. Rather than eliminating POS terminals entirely, the shift could give businesses more flexible options for accepting payments with devices they already use.
“Many enterprise retailers are implementing Tap to Phone to address specific use cases in their payments environments,” said Apgar. “Apple started it all by unlocking the NFC chip that enables this tech.”
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