iOS 11.2 and watchOS 4.2 are mostly bug-fix updates, but with one big new feature: the inclusion of Apple Pay Cash, an easy way to pay and request money from friends using your iPhone, iPad or Apple Watch.

You can keep the money you receive this way, spend it at retailers that accept Apple Pay or withdraw funds to your bank account. When you update to iOS 11.2, you will see the new Apple Pay Cash card in the Wallet app along with a companion iMessage app in Messages.

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For those of you who have iOS 11.2 installed or are just curious, let’s take a look at the Apple Pay Cash setup process, how it works and what you can do with this feature.

Setting up Apple Pay Cash

Setting up Apple Pay Cash couldn’t be easier.

Head straight to the Wallet app or simply follow the prompt that appears inside of the Messages app. In Wallet, tap on the button labeled Setup Apple Pay Cash. Agree to the terms and conditions, verify your name and identity and you’re good to go.

Verifying your identity is important as this is essentially a bank account.

Using Apple Pay Cash

Apple Pay Cash lives as an iMessage app in Messages.

When someone requests money from you in Messages, the QuickType keyboard will prompt you to use Apple Pay. To request money, you open the iMessage app, type in the amount you are owed and hit the Request button. It’s important to note that both you and the receiver must have iOS 11.2 installed and Apple Pay Cash set up on their devices.

Additionally, iOS will create a link on any dollar amount it sees.

If you tap on that, it automatically launches the Apple Pay iMessage app and pre-populates the value with the amount requested.

Adding funds

You can also transfer funds into your Apple Pay Cash account using a credit or debit card.

If you use a debit card, the whole process is free. However, using a credit card will incur a three percent fee which is standard amongst peer-to-peer payment apps and services.

From the Wallet app, you can add funds to your card or withdraw them to your bank account. If your card is empty and you receive a money request, you’ll get a prompt to add funds, making the process seamless.

Apple Pay Cash on Apple Watch

Apple Pay also gets added to the Messages app on your Apple Watch. It works the same way as it does on your iPhone—you just tap Apple Pay, set the amount and double click the Side button to confirm.

Apple Pay Cash virtual card

Aside from sending and receiving money in Messages, you can also use the Apple Pay Cash card as a full-on virtual debit card. Any place that accepts Apple Pay (in-store or online) you can pay using funds in your Apple Pay Cash account.

The card appears in the Wallet app along with your other credit and debit cards.

Tap the small “i” in the lower-right corner of the card to reveal a variety of settings and information. For instance you can add or withdraw funds, automatically or manually accept payments or view/edit card details like your PIN number and billing address.

You are also able to view all of your recent transactions, and request a statement.

It’s a wrap-up, boys and girls!

Apple Pay Cash is super easy to use.

However, it remains to be seen if Apple’s integrated solution and additional feature set are enough to displace the leaders in peer-to-peer payments like Venmo, PayPal and Square Cash.

Personally, I love the ability to keep everything within Apple’s walls.

Using the Cash card as an Apple Pay-equipped debit card is pretty fantastic, too.

No longer do I have to wait for funds to transfer if I don’t want to wait before using them. The system loses some of the fun social features prominent in Venmo, but time will tell if that is a unique enough aspect to keep Venmo on top.

What do you think about Apple Pay Cash? Is this enough to convert you from your app of choice? If you’ve already tried it out, tell us about your experience in the comments.

  • anonymous

    Oh shit Apple just change the betting game

  • websyndicate

    I’m curious to see how this takes off. This is almost like Apple having its own Digital currency. I know most people wont like the fees….just like me 🙂

    • askep3

      There’s no fee with the debit option, so as long as you have one there shouldn’t be an jssue

      • websyndicate

        I use my credit card for everything. I get points and kicks backs. I’m assuming lots of people do this.

      • askep3

        I’m not sure but do you get points for using money transfer services like this? Either way most people don’t have just one card. Having a debit card in hand is nice for things like this I guess.

      • Emmanuel

        The 3% fee will more than likely negate any rewards. Your bank may also categorise Apple Pay Cash as a cash equivalent transaction, meaning you pay interest as if it were a cash advance.

  • Cam

    Is it available in canada

  • Firedomain

    What happens if for example you have $18 in Apple Pay Cash & you try & make an Apple Pay purchase for $20? Does it charge your linked card the additional $2? Does it fail? This is the only thing I want clarified, otherwise I’m very keen to get it in Aus… whenever that is….

    • Luis Felipe Artola

      I don’t think we need to worry about that for now. Apple made the unfortunate choice that the virtual Pay cash card be a discover debit card. That greatly limits the number of businesses where it can be used to make Pay purchases, since discover is not as widely accepted as visa or mastercard. Moreover, the discover network is pretty much exclusive to the USA, so this looks like a very Apple-esque move to ensure nobody will try to use the Pay cash card on a contactless reader outside the US (people did that in 2014 when Pay first launched and continue to do so in many still unsupported countries)

      • therealjjohnson

        But when you make a payment using Apple Pay the merchant doesnt swipe it as a visa or MasterCard. The don’t even know what card is being used. It just passes a token. You can use Apple Pay where ever Apple Pay is accepted no matter the card you have attached to it.

      • Luis Felipe Artola

        When you pay using apple pay, the POS system (the terminal where you swipe or tap) does identify your device as a valid contactless visa, mastercard, amex or whatever network the original card you added to your device was on, and it will print the network name on your payment stub, along with the last four digits of the “credit card” number assigned to your iphone or apple watch (check your receipt next time you use it, you’ll see). This is why apple pay can work on contactless readers even in countries where the banks don’t specifically support it yet, such as Mexico, where I have used it many times. But many of the POS terminals in the US and elsewhere are only connected to visa, mastercard and maybe amex, not to discover, so the apple pay cash wouldn’t work on those.

        Furthermore, it is also explicitly stated by Green Dot Bank in the apple pay cash card terms and conditions that it only works where discover is also accepted:

        “The Apple Pay Cash Card is a virtual prepaid card. Currently, the Apple Pay Cash Card is issued on Discover, but this is subject to change. You will not be issued a physical card. Rather, your Apple Pay Cash Card will be provisioned to your Eligible Devices that are associated with your Apple ID and that you have enabled to access your Apple Pay Cash Account. You may only use your Apple Pay Cash Card where Apple Pay and Discover cards are accepted.”

      • Emmanuel

        That’s not how it works. Apple Pay works just like any other payment card as far as the merchant is concerned, the only difference being it uses a proxy card number and a transaction-specific token.

    • Emmanuel

      I was wondering the same thing – I tried yesterday but it declined. I think that’s poor thinking on Apple or Green Dot’s part, as most prepaid cards do support partial authorisation (where the card is approved for a certain amount).

  • techfreak23

    Thanks Apple, but no thanks. I’ll stick with VenMo… VenMo is recently sent me a notification that faster transfer times might be coming in the near future. Not that the wait time 95% of the time is inconvenient by any means.

  • John

    Seems like it might be a limited rollout, I don’t see an option to set it up on my iPhone running the beta.

  • Gary le

    Si this can safetly be used for Craigslist sales? Meaning if I sold something and receive the money there is NO WAY the buyer can get it back?