Apple Inc. is planning a new iPhone feature for Japan that will let people pay for mass-transit rides with their smartphones instead of physical payment cards. A future iPhone will include technology called FeliCa, a mobile tap-to-pay standard in Japan developed by Sony Corp., according to people familiar with the matter.
The FeliCa chip will let customers in Japan store their public bus and train passes on their iPhones. Users would then be able to tap their phones against the gate scanners instead of using physical cards. While the FeliCa chip is the standard technology underlying the service, there are several different providers of transit payment cards based on the type of transit and areas within Japan.
The Near Field Communication technology powering Apple's mobile-payments service, Apple Pay, is prevalent in North America, Europe and Australia, but the FeliCa standard dominates Japan with a penetration of 1.9 million payment terminals, according to the Bank of Japan. The terminals handled ¥4.6 trillion in transactions in 2015. Last year, there were 1.3 million NFC terminals in the U.S. and 320,000 in the U.K., according to research from Let's Talk Payments and the U.K. Cards Association.
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