Your iPhone might soon have a built-in credit card reader

Contactless payments have ramped up in the age of the pandemic, but to make Apple Pay work businesses still need clunky hardware to process transactions. According to a new report, that could soon be a thing of the past.

According to Mark Gurman of Bloomberg, Apple will soon let small businesses accept payments directly on their iPhones without any extra hardware or attachments. The report says Apple will use NFC to turn the iPhone into a “payment terminal” for tap-to-pay credit cards and other iPhones with Apple Pay set up. It’s not clear from the report if Apple will also accept Google Pay and Samsung Pay through the system, but it’s unlikely.

Gurman says the new payment system is the result of Apple’s $100 million acquisition of Mobeewave in 2020. The company offered a system exactly like the one described, with the ability to accept payments directly on the iPhone via NFC.

A hardware-free payment service would be a boon to small businesses that currently need to buy dongles and terminals from a company such as Clover or Square to accept mobile payments. In addition to the inconvenience, the hardware also ties vendors to specific payment services, while Apple’s method would offer more freedom.

The Bloomberg report says Apple may either let existing apps use the new technology or tie it to Apple Pay or a separate payment processing system. The feature is expected in the iOS 15.4 beta, which should arrive imminently following the launch of iOS 15.3 on Wednesday.