Apple makes iMessage the heart of its P-to-P strategy

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Apple formally announced the debut of its rumored Venmo-like P-to-P service, and as with anything Apple-related, it's deeply embedded into the overall Apple ecosystem.

Rather than hide P-to-P in the Wallet app or any other part of Apple Pay, the company built its P-to-P offering around its Messages app. “It’s super simple because it’s integrated right into Messages … you securely authenticate with TouchID and if you receive money with iMessage, it goes into your Apple Pay cash card," said Craig Federighi, Apple's senior vice president of software engineering, in a presentation at Apple's annual Worldwide Developers Conference (WWDC), which began Monday.

The Messages app also integrates P-to-P as an auto-fill suggestion when typing. If a friend mentions needing an amount of money, the Messages app can suggest sending those funds via Apple Pay from within the chat.

Michael Short/Bloomberg

Apple’s move into the P-to-P payments landscape is somewhat late to the game and faces stiff competition. PayPal's Venmo is often cited as the biggest threat, but Apple's system also resembles what Facebook is doing with its Messenger product under the leadership of former PayPal boss David Marcus.

A recent Aite Group report investigates the current P-to-P competitive landscape, which is best described as a fragmented ecosystem of bank-based initiatives such as Zelle and Popmoney, as well as myriad alternative vendors such as Circle, PayPal, Venmo, Square, Google Wallet and Facebook.

Apple Pay’s P-to-P offering will be made available across iOS devices as well as the Apple Watch as part of the iOS 11 update.