SAN FRANCISCO, CA - JUNE 08: Apple Vice President of Worldwide Online Stores, Jennifer Bailey, speaks about Apple Pay during Apple WWDC on June 8, 2015 in San Francisco, California. Apple annouced a new OS X, El Capitan, and iOS 9 during the keynote at the annual developers conference that runs through June 12. (Photo by Justin Sullivan/Getty Images)
Justin Sullivan—Getty Images
By Alejandro de la Garza
October 4, 2018

Jennifer Bailey, Apple’s vice president of internet services, has her sights set on your wallet. But she doesn’t want the cash inside — instead, the company wants to replace your wallet altogether.

Speaking at Fortune’s Brainstorm Reinvent 2018 conference, Bailey explained how the company’s 2014 introduction of Apple Pay, a payment system that allows users to make purchases at participating retailers simply by tapping their phones on a point of sale system, was the first step in the company’s plan to replace the physical wallet altogether.

“When we thought about Apple Pay, we really thought broadly about wanting to do services that replace the wallet,” Bailey explained. “And we wanted to start with payments. Payments are something that people do every day. It’s a constant part of your life.”

When Apple introduced the Apple Pay feature back in 2014, the system worked well, but it was only accepted at a limited number of retail locations.

“As some of you may know, in the United States the payments industry is a bit farther behind from a technology perspective than other countries,” said Bailey. “We’ve spent quite a bit of time growing that acceptance footprint. We think this year we’ll end at 60% of retail locations in the U.S. accepting Apple Pay.”

But growing a broad acceptance of Apple Pay is only one part of the company’s strategy. Apple plans to gradually expand the capabilities of its Apple Wallet app, allowing iPhone users to leave more and more of their physical cards at home.

“If you look at some of the things we’re working on now in terms of replacing the wallet, we’re also doing things like transit,” Bailey says. “Today in 12 metro cities across the world you can use your Apple Wallet with Apple Pay technology to go through transit stations.”

But Apple doesn’t plan to stop with transit passes. Some universities have started making Apple Wallet-compatible student IDs, allowing students to tap into their dorms or pay for meals with their iPhones. Walgreens lets customers use their iPhones to access their store memberships. Some sports franchises in the U.S. not only have fully Apple Pay-enabled concessions, but also allow fans to store their tickets in their Apple Wallet. New York Giants season ticket holders can enter MetLife Stadium simply by tapping their phones.

According to Bailey, Apple is eyeing even more areas in which to expand Apple Wallet’s capabilities.

“There’s actually a number of areas you can think about that we can extend this type of technology. Hospitality, hotel rooms, is definitely one,” Bailey explained. “Versus being issued a card at the check-in, you could check in via the app and you could get digital-issuance of a hotel room key.”

For Bailey, Apple’s push to digitize your wallet is a method of expanding the iPhone’s capabilities. “It’s all actually about making people love their iPhones,” said Bailey. “That is why we are doing what we do.”

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