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Apple targets payments between friends

Silicon Valley is obsessed with a particular part of the finance business that involves sending cash to friends using an app. That’s led to a flurry of options that often aren’t profitable because they charge little to no transaction fees. PayPal and its subsidiary, Venmo, are among the most popular, though they face a growing list of competitors, including Google, Facebook, and Square.

Now Apple plans to get in on the action, too. The world’s most valuable technology company has been talking with banks about introducing its own feature to Apple Pay that will allow users to send money to friends, a person familiar with the plans told Bloomberg last month. If Apple hopes to compete, it will also need to make its service free to use with debit cards, according to analysts.

Apple isn’t likely to find a way to profit directly from the feature. Instead, the company will probably use it to increase adoption of Apple Pay in stores. The mobile tap-to-pay option hasn’t taken off as quickly as expected since it debuted about a year ago. Owners of newer iPhone models used Apple Pay in 2.7 percent of Black Friday transactions at stores that support the feature, compared with 4.9 percent on the same day last year, according to data from tracking firm InfoScout.