I have been curious how this compares to what is offered by Paypal. They sent us a little credit/debit card reader that works with our Android phone.
PayPal is essentially a bank owned by eBay. PayPal charges either the sender of money or the receiver of funds a fee, and sometimes both. If you are using a credit card, PayPal will act as the credit card processor in lieu of the credit card processor the merchant has a contract to provide those services for him. You can either reimburse PayPal from your account with them, or they will withdraw money from your bank account by ACH transfer. Once it's gone from your account, getting it back, is far more difficult than putting it in contest with a credit card company. ACH transfers may only be challenged within a 48 hour window or they are by law, permanent.
Apple Pay is not a bank or a credit card service processor. Apple Pay does not charge the Apple Pay user or the merchant who accepts Apple Pay any fees. All fees for use of Apple Pay are paid by the banks and debit/credit card issuers who have contracted with Apple for the ability of their card holders to use Apple pay, with the intent that it will be far less expensive than the fraud they were paying before Apple Pay was instituted from stolen cards and IDs. Apple does not receive any data about what you bought or where, or even when. Such transactions are only between you, the merchant, and your credit/debit card issuer. The merchant does NOT get any information about you, your credit/debit card, address, buying patterns, etc., so they cannot track you. If they want that, they can give you a loyalty card.