Apple now includes retail credit cards in Apple Pay. CNET/James Martin
In addition to linking debit and credit cards to Apple Pay accounts, users can also now include store credit cards from companies like Kohl's, JC Penney and BJs as well as loyalty cards from brands such as Walgreens and Dunkin' Donuts.
"Apple Pay automatically presents the right card so you never miss a reward," Jennifer Bailey, vice president of Apple Pay, said Monday during the company's keynote speech at its annual developers conference, WWDC, in San Francisco.
Apple also announced it is renaming Passbook to Wallet. This change reflects the way Passbook actually works, which allows Apple users to digitally store everything from concert tickets to airline tickets. Bailey called it "one place for all your credit and debit cards, loyalty cards and more."
Apple Pay has grown quickly since the company launched the mobile-payments service in October, though Apple now faces more competition from Google's Android Pay, unveiled in late May, and Samsung's mobile-payments service, called Samsung Pay, as well as PayPal. In March, Apple said the service was available in 700,000 locations, up from 220,000 from when it launched. And more than 2,500 banks supported the service compared with about 500 at launch. As of next month, the company expects to surpass 1 million locations where Apple Pay will be accepted, Bailey said.
Apple, Google, Samsung and others are all trying to grow their mobile-payments systems to make their products more integral parts of their users' lives, while also gaining new insights on people's spending behavior. Yet, mobile payments for years hasn't gained much momentum, since people have seen little reason to switch from plastic and cash, and many retailers haven't signed on to these new systems.

Apple Pay appears to be giving mobile payments a much-needed boost, but time will tell if it will last. In January, Apple said Apple Pay made up more than $2 out of every $3 spent on purchases using contactless payments. (Contactless payments cover any devices -- smart cards included -- that make payments using a radio frequency.) Cook has said that "2015 will be the year of Apple Pay."
Apple announced in September that it was partnering with Visa, Mastercard and American Express along with several issuing banks to allow iPhone owners to store their credit card accounts on their devices and pay for items by tapping their phones on payment terminals. Apple has also worked with retailers, including Macy's, Walgreens, Duane Reade, Staples, Subway, McDonald's, Disney and Whole Foods, to bring Apple Pay to store locations.

Bailey announced Monday that the company is now adding the Discover credit card network to its roster. She also said that Apple is adding more popular merchants that will accept Apple Pay, including Trader Joe's, Baskin Robbins, and JC Penney. Apple has also partnered with the NBA to allow basketball fans to pay for gear donning their favorite team's logo in both finalist's arenas.
Apple is also making a push to ensure 
 isn't exclusive to big retailers. Bailey added that Apple is working with the mobile-payment company Square to allow small businesses to accept Apple Pay starting this fall.
Bailey also noted that Apple has seen strong momentum for Apple Pay within mobile apps. She reported that iOS developers are seeing checkout rates for applications that include an Apple Pay option within applications more than double. Several popular mobile apps have now included Apple Pay in-app purchasing buttons, including Delta Airlines and Etsy. This allows customers to simply click on the Apple Pay icon to pay for things while browsing in the app from their phones.
Apple is also working with the social-media site Pinterest. Later this month, the company will launch "buyable pins" that will allow users to buy things directly from the Pinterest app using Apple Pay.
Building on its strong momentum for Apple Pay in the US, the company also said starting next month the mobile-payments system will be available in the United Kingdom. Apple has signed up several big retail chains for the launch, including pharmacy Boots, grocery store chain Waitrose, and department store Marks and Spencer. In total, more than 250,000 retail locations in the UK will support Apple Pay at launch, which is more than Apple started with in the US at launch. And Bailey said that the company will support more than 70 percent of credit and debit cards in the UK.