Cupertino, California - With a new piece of software that allows the iPhone to function as a checkout system, Apple wants to become a direct competitor to companies that sell the digital payment systems used in shops and restaurants globally on smartphones and tablets.

Apple announced February 8 that it plans to allow users to directly accept contactless card payments with any iPhone.

In practice, the technology could ultimately see more and more shopkeepers, waiters, bartenders, and cashiers whip out an iPhone or iPad whenever someone wants to pay, while undermining the need for existing payment solutions.

As such, Apple is muscling its way into a business that has so far been dominated by market pioneer Square in the US.

"As more and more consumers are tapping to pay with digital wallets and credit cards, Tap to Pay on iPhone will provide businesses with a secure, private and easy way to accept contactless payments," said Jennifer Bailey, Apple's vice president of Apple Pay and Apple Wallet.

Apple says it wants to make its new "Tap to Pay" functionality available to millions of merchants across the US. The first payment platform to make it available to its business customers will be Stripe.

The service will work with contactless cards from Mastercard, Visa, and American Express, among others.

Tap to Pay relies on the NFC chip built into iPhones (and Android phones) – the same contactless technology used for contactless payment with Apple Pay, Google Pay, and Samsung Pay.