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Apple Watch works with Apple Pay to replace your credit cards

Apple Watch works with Apple Pay to replace your credit cards

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Want to use Apple Pay with your iPhone 5, 5C, or 5S? You'll need an Apple Watch

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It turns out that Apple's Watch is also a wallet. The company has announced that the new Apple Watch works with Apple Pay, which was just revealed today. With the system, you don't need to take out your plastic credit card as the cash register to pay. Once you've added your MasterCard, Visa, and American Express cards to your wallet through iTunes, you can use the device itself to make a payment at one of the over 220,000 retailers that are on board with Apple's system.

Apple Watch uses a mini version of Passbook to hold your credit and debit card info for payments. When you want to buy something at a cash register, you just need to double click the button beneath the "Digital Crown" and hold it up to the contactless payment system. Apple is using "Device Account Numbers" for each of your cards, which means that your actual card number isn't transferred to the merchant. There's also a "transaction-specific dynamic security code" to help keep your payment info secure and prevent hackers from skimming your account number and using it for another purchase. After a successful payment, the watch will vibrate and make a small beep.

On iPhone 6 and 6 Plus, the feature uses NFC and Touch ID to authenticate payments. From an image shown on stage, it appears that the Apple Watch has NFC so that you can tap it against contactless point-of-sale systems at cash registers to make a payment, but full specifications are not yet available.

Most notably, Apple says in a press release that the Apple Watch will let iPhone 5, 5C, and 5S users use Apple Pay. That means that you won't have to upgrade to the latest phone to use Apple's contactless mobile payment system. It also means that Touch ID isn't a necessary component to use Apple Pay.

Apple Pay will come to Apple Watch "early" next year, and will launch first on iPhone 6 and iPhone 6 Plus this October.

Apple Watch Apple Pay

Check out our Apple iPhone 6 and iWatch liveblog for more!