Apple Pay’s Biggest Competitor Could be a Totally New Credit Card

Apple Pay’s Biggest Competitor Could be a Totally New Credit Card

November 10, 2014         Written By John H. Oldshue

Apple Pay is being heralded as a revolutionary new payment system because of its two new security features: tokenization and fingerprint identification. The shocking number of data breaches in the last year have made credit card theft the crime that Americans worry about the most, according to a recent report. These two Apple Pay features are expected to calm consumer fears and greatly minimize data breaches.

As a result, Apple Pay could greatly reduce your need to physically carry a credit card. But don’t expect credit card issuers to accept this and not fight to keep your hands on their cards.

Just two weeks after the introduction of Apple Pay, American Express announced that tokenization is coming soon to some of its cards.

American Express will replace credit card numbers with unique tokens which can be used to complete transactions online, from a mobile app or in-store with a mobile near field communications-enabled device. The card will have an embedded EMV chip that will generate a unique token for each transaction. Then, that token will be passed to a payment terminal via near field communications, much the same way that Apple Pay makes a transaction.

“By using tokens, merchants and digital wallet operators will no longer need to store consumers’ sensitive payment account information in their systems,” American Express announced in a statement. “In addition, tokens can be assigned for use with a specific merchant, transaction type or payment device to provide further protection against fraud.”

In addition, issuers are developing fingerprint identification for credit cards.

MasterCard is already working on a fingerprint ID system in their cards. MasterCard is teaming with Zwipe in the development of a credit card that combines biometric authentication and contactless payment technology. The system would be similar to Apple’s TouchID system where your fingerprint would need to be verified by the card before it can be used. It may seem like something out of a James Bond movie, but the system is currently being tested in Norway.

If these two security features are incorporated into a credit card, then the argument that Apple Pay is somehow more secure than credit cards will be a moot point.

Credit card issuers in general are supportive of Apple Pay, but they would likely prefer to keep their physical cards in the hands of consumers. They may be able to do that if both these developments take place.

The information contained within this article was accurate as of November 10, 2014. For up-to-date information on any of the terms, cards or offers mentioned above, visit the issuer's website. Many of the offers on this article are from our affiliate partners, and may be compensated if you take action with any of our affiliate partners.


About John H. Oldshue

John Oldshue is the creator of He worked for over 15 years in television and won an Emmy award for his reporting. He covers credit card rate issues for
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