Visa Europe security updates may set the stage for Apple Pay expansion

The credit card issuer plans to put in place by mid-April in Europe token technology, which Apple Pay uses

Visa Europe is rolling out the security technology that Apple Pay uses to process payments, raising the question of whether the Apple mobile payment system will cross the pond in the coming months.

By mid-April, Visa member banks in Europe will be able to process tokens, the company said Tuesday. This technology replaces a person's credit card information with a random series of numbers called a token, which retailers send to a financial institution when a person uses a smartphone or wearable device to pay for merchandise. The technology is considered better at protecting a person's financial data since it doesn't transmit credit card details. Apple uses tokens to complete mobile payments made with the iPhone 6, iPhone 6 Plus and its upcoming smartwatch.

Setting up this infrastructure clears the way for Apple to offer its mobile payment service in Europe. Visa Europe, however, did not say whether Apple would use its system. The credit card issuer said in a news release that tokenization technology is used in new mobile payment products.

Apple hasn't announced when Apple Pay will be available internationally. For now, the service is only available in the U.S. where it has become popular since being introduced in October. During Apple's recent earnings call, CEO Tim Cook said Apple Pay accounted for US$2 out of every $3 spent using contactless payment systems on the networks of Visa, MasterCard and American Express.

The mobile payment space has seen a resurgence of popularity among technology companies lately, partly fueled by the debut of Apple Pay.

On Monday, Google announced that Verizon, AT&T and T-Mobile will begin preinstalling Google Wallet, the search giant's contactless payment system, on new Android smartphones later this year. As part of that deal, Google will also acquire some technology from Softcard, a competing mobile wallet app developed by the carriers.

Google Wallet debuted in 2011 and, like Apple Pay, uses NFC (near field communication) to complete a transaction once a mobile device is placed close to a special credit card terminal designed to work with the technology.

Last week, Samsung acquired mobile payment company LoopPay and will reportedly incorporate its technology into Samsung devices, including the upcoming Galaxy S6 smartphone. LoopPay doesn't use NFC to handle transactions. Instead, LoopPay's technology generates magnetic fields that simulate those created by a credit card's magnetic strip, essentially making any terminal capable of receiving mobile payments without modification.

Fred O'Connor writes about IT careers and health IT for The IDG News Service. Follow Fred on Twitter at @fredjoconnor. Fred's e-mail address is fred_o'connor@idg.com

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