September 22, 2014 By Shane Schick 2 min read

There are no mentions of the actual words “Apple Pay,” but anyone who sees the latest advertisements from PayPal will have no doubt that a campaign to undermine the security perceptions of Apple’s mobile payment service is well under way.

“We, the people, want our money safer than our selfies,” reads an image of the PayPal ad that surfaced on AppleInsider, a possible reference to the recent theft of nude celebrity photos via Apple’s iCloud service earlier this month. Apple’s real marketing challenge, however, will not only be to help the world forget about its recent security lapse, but also to convince more chief information security officers and major merchants that Apple Pay has built in enough protection to be trusted.

How Does Apple Pay Work?

This feature works by replacing credit card numbers with a dynamically generated proxy number that can be stored in a single, secure location. Data from the proxy token is transmitted through a chip-based security feature widely used on near-field communications (NFC) networks in Europe called EMV (short for Europay, MasterCard and Visa). Users can make purchases by waving an iPhone 6 near a contactless reader with a finger on the Touch ID button, which then verifies purchases. It is expected that this token-based payment information will be stored on the iOS Passbook app.

According to analysts interviewed by SearchSecurity, the biggest risk with this feature lies in tying so much of the transaction activity into an iPhone 6. If the smartphone gets lost or stolen, criminals might only need to answer an Apple ID security question to compromise an account via iCloud. However, Apple has said iPhone 6 owners can simply disable a lost or stolen device using its Find My iPhone app.

App Isolation and Security

Apple has also said its use of NFC will be limited to Apple Pay, which means third-party apps will not be able to leverage the technology for other purposes, MacWorld reported. That may leave some developers disgruntled, but it closes off another possible area of vulnerability. Meanwhile, Apple just joined GlobalPlatform, the organization responsible for defining standards for the secure elements used to store sensitive data in NFC phones.

On the Naked Security blog, researchers point out that Apple does require users to go through two-step verification before making their first purchase on a new device. However, they suggest that process should kick in earlier when iPhone 6 data is being restored.

Perhaps most critically, an article on Techworld argued that even if Apple Pay’s security is robust, it could become a huge target for hackers. In that case, the weakest links might not be the hardware or software but users who get fooled by social-engineering tricks or attacks that focus on the surrounding ecosystem, such as the point-of-sale terminals or Windows machines that some consumers may use in conjunction with Apple services.

As its October launch date looms, Apple may still need to explain how it will make sure that crime doesn’t pay for anyone who takes aim at Apple Pay.

Image Source: Flickr

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