Apple allegedly working on peer-to-peer money transfer as part of Apple Pay

Sending money to others for personal payments currently requires a service like Square Cash or Venmo. Apple is reportedly working on a similar peer-to-peer money transfer service as part of the Apple Pay service that would let users send money to one another quickly and with security as a primary focus.

Venmo's iOS app

Venmo's iOS app

Re/code says that Apple has apparently held discussions with top names in the payment industry about the service, which might launch later this year. It's also noted that Apple has talked with Visa about a prepaid debit card service that would be tied to the peer-to-peer payment transfers. Think of an Apple-branded digital debit card that could be used at retailers, letting users instantly spend money that is transferred to them without needing to deposit it into an intermediary bank account. 

If Apple decides to enter the peer-to-peer payment market, it would most likely lose money initially. A 2015 report from research company Crone Consulting pointed out that in the short term, it costs more to set up and validate new accounts and process transactions than the revenue made from transfers. However, the peer-to-peer transfers would be another way for Apple to bring new users into the Apple Pay fold -- Crone believes that adding peer-to-peer transfers could double usage of Apple Pay by iPhone owners in as little as 18 to 24 months. 

In addition, there is growing competition in the space. Venmo (a subsidiary of PayPal) and Square have a large and growing user base, and even Facebook has entered the market by adding the ability to send money via the social network.