CBA, NAB and Westpac revise Apple Pay request to the ACCC

Sally McMullen 13 February 2017 NEWS

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Australian banks change tack in their request for open access to the NFC function of Apple Pay.

In the latest move in the Apple Pay war, Australian banks have narrowed down their request to the Australian Competition and Consumer Commission (ACCC). In a revision to their previous proposal, they now seek permission to focus solely on access to the NFC function on the iPhone. Previously, Apple has denied giving banks open access to Apple Pay and requires its 45 partnered banks and credit unions, including institutions like ANZ, to pay a fee to access its digital wallet.

According to the banks, open access to the NFC function on Apple products is required to give customers more choice and to facilitate innovation in mobile payments. The banks believe that access to Apple Pay will also benefit Australian consumers across retailing, loyalty programs, building or member lounge security and other NFC-cases. Contradictory to Apple’s arguments, the banks reject the idea that their proposal is based on a wish to avoid Apple Pay fees.

“This application has always been about consumer choice, and allowing competition between the makers of mobile wallets to offer the best products and features they can to determine which mobile wallet consumers will use,” says payments specialist and spokesperson on behalf of the applicants Lance Blockley. According to Blockley, the applicants aim to put their digital offerings head to head with Apple Pay to let the market and individual consumers decide which option best suits their needs.

After having their proposal rejected in a draft decision in November, the four banks behind the application, Bendigo and Adelaide Bank, Commonwealth Bank of Australia, NAB and Westpac, have proposed to remove collective negotiation on the potential to pass through additional fees Apple wishes to impose on the payment system, which is half the original term they initially requested.

Previously, Apple has rejected the banks’ terms on the basis that they’re trying to stifle market competition in the digital wallet space and avoid paying the Apple Pay fees. This news also comes just days after global head of Apple Pay Jennifer Bailey expressed the company’s position as the dominant leader in mobile payments in an exclusive interview with AFR. Bailey said that customers are willing to move to another bank in order to use Apple Pay and that the banks’ refusal to cooperate with Apple are putting them at risk at falling behind in the future of digital wallets.

While CBA, NAB, Bendigo and Adelaide bank and Westpac are confident that their new submission demonstrates what’s in the public’s interest, Apple is unlikely to budge. Looks like it’s your move, ACCC.

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