Apple Pay and Apple Wallet: Key differences and features

Apple Pay and Apple Wallet serve distinct functions within the Apple ecosystem. Apple Wallet acts as a digital storage space for debit and credit cards, boarding passes, concert tickets, loyalty cards, and certain IDs. Apple Pay is the specific payment service that utilizes the cards stored in the Wallet to facilitate transactions.

When using Apple Pay, security is maintained through a Device Account Number (DAN) stored in a Secure Element chip. This ensures that the actual credit or debit card number is never shared with merchants. Instead, a unique security code is used for each transaction.

Users can also earn cashback through Apple Pay at compatible establishments. While many stores support the service, specific rewards vary; some compatible merchants offer 2% cashback, while certain brands like T-Mobile, Nike, Walgreens, and Uber may offer up to 3% cashback depending on the user's registered cards and store policies.