Apple Pay may debut in India in October: What users need to know

Apple Pay could make its debut in India as early as next month, Reuters has reported.

Apple has not officially confirmed the October launch. If the reported rollout goes ahead, it will give iPhone and Apple Watch users a way to make contactless card payments directly through their devices, without opening a separate payment app. Apple Pay will reportedly begin with Axis Bank credit cards,

The development comes as India’s digital payments market is undergoing another shift. From October 15, UPI transactions above Rs 2,000 will attract a 0.4 per cent Merchant Discount Rate (MDR), subject to the applicable categories and exemptions.

How Apple Pay works

Apple Pay uses tokenisation to protect card details. Instead of storing or sharing the actual 16-digit card number with the merchant, the service creates a unique token linked to the device.

During the India rollout, users with eligible Axis Bank credit cards will be able to add their cards to Apple Wallet. Once the card is verified, the payment can be made at a contactless terminal by holding an iPhone or Apple Watch near the reader.

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The transaction can be authenticated using Face ID, Touch ID or the device passcode. Apple Pay can also be used for payments within apps and on websites where the service is supported.

According to Reuters, Apple is also in talks with HDFC Bank and ICICI Bank, although commercial terms with the two banks have not yet been finalised. Other banks could be added later.

UPI challenge

Apple Pay will enter a market where UPI already dominates digital payments. The competition is also becoming more contactless. NPCI recently introduced a tap-and-pay feature for UPI, allowing users to make payments at compatible terminals using NFC without opening a UPI app.

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However, the reported Apple Pay rollout is focused on card payments. It would therefore offer a different payment route from the QR-code-based UPI transactions used widely across India.

Major drawbacks

The timing of the launch comes as India’s UPI ecosystem is undergoing changes, but Apple Pay’s biggest limitation could be its coverage. The service is primarily aimed at credit card users, while many merchants in India still rely on QR-code-based UPI payments.

This means Apple Pay users may still have to switch to UPI apps such as Google Pay, PhonePe or BHIM at stores where contactless card payments are not available.

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So, why is Apple Pay debuting in India now? A key regulatory change has helped pave the way. The RBI’s revised authentication framework allows biometric authentication such as fingerprints and facial recognition to be used as an authentication factor for digital payments. This makes technologies such as Face ID and Touch ID more compatible with India’s card-payment framework.