With the release of iOS 18.1 later this year, Apple will allow you to launch third-party apps for contactless transactions instead of Apple Pay. Participating apps can support NFC features such as payments, ID badges, event tickets, car keys, hotel keys, closed-loop transit, and rewards cards, marking the first time third-party developers will be able to use NFC for more than just basic tag reading.
That said, there are a few riders associated with these new changes. Apple says that developers will need to sign a commercial agreement, request access to the NFC and Secure Element (SE) APIs, and pay the fees required to access these features. The company claims this is to ensure your iPhone's security isn't compromised, and that only authorized developers who meet regulatory, security, and privacy requirements can access these APIs.
The Secure Element is a chip on your iPhone responsible for securely storing sensitive data on-device. Once developers have access to it, as well as iOS' NFC API, they'll be able to add tap-to-pay functions to their apps. You can either choose to use these apps directly, or set an app as your default contactless app in Settings. You could double-click the Side button on your iPhone to make payments with a Chase app, for example, or to swipe into work using a digital corporate ID—so long as those developers pay Apple a fee.
Initially, Apple is making these APIs available to developers in the U.S., U.K., Australia, Brazil, Canada, Japan, and New Zealand. If you live outside of these regions, you're going to have to wait to try this out. In addition, the company says it will support NFC for government IDs in the future.
It's the latest among a series of steps Apple has taken to open up its ecosystem, following increased regulatory scrutiny from governments across the world. The European Union recently charged the company with violating the Digital Markets Act, after forcing the company to open up app stores, web browsers, and NFC payments on iOS. The E.U. is also responsible for Apple switching to USB Type-C starting with the iPhone 15 series.
While it's generally considered good news whenever Apple opens up its ecosystem, this move may mean that Apple's Wallet app starts to become a little less important. If every developer forces you to use their app to access these features, the convenience of a "hub" such as Apple Pay and Apple Wallet could be lost. We'll have to see how developers respond to this change in policy.