Apple agrees partnerships with banks and retailers to deliver mobile payment service in the UK

Apple said consumers will be able to link payment cards issued by banks including RBS, HSBC and Santander to the new mobile payment service Apple will offer, it said. Other banks including Bank of Scotland and Lloyds are expected to enter into similar partnership agreements with Apple over Apple Pay later this year, it said.

Retailers such as Marks and Spencer, Boots and McDonald's will support payments via the Apple Pay service. In total, Apple Pay will be available in more than 250,000 locations in the UK, Apple said. Consumers will also be able to make transactions via Apple Pay when using a number of apps, including from British Airways, Airbnb and thetrainline.com.

Apple Pay launched in the US in September last year. It is a mobile payment system that uses near-field communications (NFC) technology. NFC uses radio waves to transmit data between devices and allows contactless payments to be made. Apple Pay works with Apple's iPhone 6 and iPhone 6 Plus phones and with the Apple Watch.

"Apple Pay has quickly become a big part of millions of users’ everyday shopping routines, providing a simpler, faster and more secure way to pay," Eddy Cue, Apple’s senior vice president of internet software and services, said in a statement. "We’re thrilled to bring Apple Pay to the UK with support at launch from the most popular banks, an incredible roster of merchants and many of our users’ favourite apps.”

Apple said Apple Pay is secure and protects users' privacy.

"When adding a credit or debit card, the actual card numbers are not stored on the device, nor on Apple servers," Apple said. "Instead, a unique device account number is assigned, encrypted and securely stored in the secure element on your device, and each transaction is authorised with a one-time unique dynamic security code."

Last year, an analyst with Keefe, Bruyette and Woods said that a draft agreement between Apple and US banks showed that Apple was looking for the banks to give it access to customer data as part of any commercial tie-up on Apple Pay.

Sakhrani said Apple had asked for data from banks on customers' payment card usage, including purchase volume information, data on customers' in-store purchases relative to their in-app purchase, as well as data on who the top 100 retailers were that customers were spending money with and what the average purchase amount was, according to a report by Finextra.