The agreement includes participation by Visa, MasterCard and American Express and will be announced September 9 along with unveiling of the next iPhone, according to the source, who Bloomberg said asked not to be identified because the talks are private.
It's not clear at this point if the mobile wallet functionality will be limited to certain geographies at launch.
As the report notes, Apple will not be the first company to integrate a mobile wallet - Google already has one - but it's move is likely to have the most impact considering the marketshare Apple's phones enjoy in the key market of the United States.
"Love it or hate, Apple drives a lot of standards in the industry," Bajarin told Bloomberg. "They are the mover in these markets. When they do something, the industry seems to follow."
The move will create increased brand loyalty and keep people within Apple's ecosystem
"It's about retention, solving and adding features that keep your base engaged and keeping them loyal," Bajarin said.
Apple is believed to have the largest collection of credit cards on record for any company, with over 800 million iTunes account holders who presently enjoy a seamless purchase experience for digital goods like apps, movies, music, and ebooks.
With NFC integration in the upcoming iPhone 6 models and tie-up with the likes of Visa, MasterCard, and American Express, Apple will aim to move this speed and convenience of paying from the digital to the real world.
With inputs from Reuters