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Everything You Need to Know About Using Apple Pay in Real Life

Apple Pay on a smartphone
Apple Pay on a smartphone

(Associated Press)

On October 20, Apple's pay-by-iPhone technology, Apple Pay, rolls out to consumers. If you're an iPhone owner, It may immediately change the way you buy a few things at a few stores. Over time, it may have a much larger impact.

Announced last month, Apple Pay is a chip-powered system that lets you pay for items in stores by tapping your iPhone 6 or iPhone 6 Plus against a special receiver at the cash register. (There will also be an online component that lets you pay for e-commerce goods using your Apple ID with the click of a button and a scan of your fingerprint. We’re focusing on the in-store version of Apple Pay here.)

If it works properly, the NFC-powered system could make waiting in line less horrible for both iPhone owners and other impatient shoppers. It could also, some analysts predict, completely transform how we pay for things in brick-and-mortar stores.

In other words, now might be a good time to learn about it! Below is a brief guide to what this new world of digital transactions will look like in the flesh.

How does one enable Apple Pay come Monday?
That’s when the new version of iOS 8 — iOS 8.1 — will be available to download. Once you’ve updated your phone, you’ll just need to open the Passbook app and enter your credit card information.

Is every single person with an iPhone going to be bragging about her cool, convenient Apple Pay abilities?
Just the ones who have already been bragging about buying an iPhone 6 or an iPhone 6 Plus! These devices, unlike their predecessors, are equipped with a near-field communication (NFC) chip that enables these transactions to go down.

So people won’t be able to check out at McDonald’s with the new iPad Air 2?
No, though that would be sort of appropriately American, wouldn’t it? All the new iPads announced yesterday will only allow you to store your credit card in iTunes and pay for transactions via your fingerprint. They’re not equipped with NFC and therefore won’t work onsite with retailers.

OK, so how is this going to go down? Are people going to be waving their phones around at the Whole Foods cash register? That place is already out of control.
Ideally, no. Each time someone with a capable iPhone approaches the checkout counter of one of the initial 220,000 participating stores, there will be a contactless reader that — using its NFC capabilities — will automatically identify the presence of that person’s device. After the cashier scans the items that person wants to purchase, a summary of the transaction will then appear on his iPhone screen, and he’ll need to confirm that everything’s good by scanning his fingerprint on the home button. When the phone vibrates and beeps, he’ll know the transaction went through. That’s it.

Hmm, that seems like a good opportunity for Apple and the place I'm shopping at to track my credit card transactions. How do I know this is secure?
The biggest selling point with Apple Pay, aside from convenience, is that neither Apple nor the merchants you’re doing business with can see your information.

This security feature is built into the Apple Pay setup system, which assigns your credit card a unique account number. That number is then encrypted and tucked away on a secure chip in your device.

Every time you use your phone for a transaction, that same account number, along with an additional changing security code, is used to process and confirm the payment.

Because of this payment ecosystem, Apple swears it can’t see anything you’re buying. And if that’s not enough for you, here’s a more detailed explanation of the process.

Isn’t “Apple Pay” just “papple” in pig latin?

Where will people be using it?
Lots of spots! As we mentioned above, Whole Foods and McDonald’s will be participants. As will Macy’s, Duane Reade, Texaco, Walgreens, Bloomingdale’s, Nike, Subway, Petco, Staples, Chevron, RadioShack … and moooore.

Plus, a ton of other places will be using the feature for in-app purchases on your phone. Just look at this fancy screen!

Tim Cook with logos of Apple Pay participating retailers
Tim Cook with logos of Apple Pay participating retailers

And if you don’t see your favorite burrito merchant, don’t worry: It’s likely that if a merchant is participating in Apple Pay, it’ll be annoyingly vocal about it, so you’ll know. Even Apple included its brand icon in the slide for its own presentation above. Congrats on your latest partnership, guys!

What credit cards work with it?
So far, American Express, MasterCard, and Visa have all jumped on board. Yesterday during the Apple presentation, CEO Tim Cook said that he has added about 500 banks since he announced Apple Pay last month.

Tim Cook with bank logos
Tim Cook with bank logos

So, say I'm in line at Duane Reade. One person in front of me has a debit card and the other one has an iPhone 6. Who do I follow behind for quickest checkout?

For the meantime, I'm going to guess that anyone trying out Apple Pay for the first time will probably fumble with it, or start an unnecessarily long conversation with her cashier about the technology.

For now, I'd say the debit card owner will definitely be faster. But in the near future, that could all change. Actually, the success of Apple Pay depends on that.

If I don’t have an iPhone, is there any reason I should care about this?
It’s entirely possible that this could make lines go faster for you. And who knows? If Apple makes NFC a hip thing, maybe the many Android and Windows Phone handsets that are already equipped with that technology, and have been for years, can piggyback on its success.

But — just a thought — don’t cut up all your credit cards quite yet.

Follow Alyssa Bereznak on Twitter or email her.