Apple in Talks to Offer Money Transfer System That Would Rival PayPal, Venmo

Apple has long said it wants to take the place of your wallet. It is working on another initiative that could bring it closer to that goal.

The Cupertino, Calif.-based technology giant is in talks with several big U.S. banks to develop a digital payments system that would let people send money to each other via their phones, similar to services offered by PayPal and its subsidiary Venmo, according to multiple people familiar with the talks. It’s not yet clear whether Apple will work with credit card networks on the new service as it does for its existing Apple Pay service, or bypass them in the process.

An Apple spokeswoman declined to comment. A PayPal spokesman said in a statement that the company “welcome[s] any development that encourages people to address the awkwardness of dealing with cash when paying friends or family back. We have multiple services to make that easy including both PayPal and Venmo. Our services work across multiple devices and operating systems, as well as online.”

So-called peer-to-peer payment products can be money-losers for companies, since many are free to use for consumers but not for companies to support. But companies often see them as a way to get more people to use a platform they are built into or to get existing users to use that platform more frequently. Apple would likely see such a service as a way to get more people using its existing mobile payment service, Apple Pay, and to make iPhones more useful overall in a customer’s life.

ApplePay chief Jennifer Bailey talked this summer about Apple’s ambitions to one day replace the old-fashioned wallet with its mobile devices. At the Worldwide Developers Conference in June, she announced a key expansion of Apple Pay, the tap-to-pay mobile payments service that is on track to reach 1.5 million retail locations by the end of the year. Apple also has added support for store-brand credit cards and loyalty cards.

In an appearance at the Code/Mobile conference, Bailey announced that Starbucks and KFC would join an expanding roster of retailers that accept Apple Pay.

The new person-to-person mobile payments would allow consumers to use their iPhones or Apple Watches to send money to someone else’s bank account or, potentially, debit card. It seems logical that such payments would be linked to Apple Pay.

The talks were first reported by the Wall Street Journal.

This article originally appeared on Recode.net.

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