Australia: Apple “Banks use digital wallets as a revenue source”

Three of the big four banks are pushing to pass the costs of Apple Pay on to their customers as a way to “condition the market” into paying extra fees claimed Apple last week.

Apple argues that banks want to pass through to their customers the fee that Apple will require them to pay to use the iPhone infrastructure. This is one of the main issues in the battle between Apple and Commonwealth Bank of Australia, National Australia Bank, Westpac Banking Corp and Bendigo and Adelaide Bank.

In a submission published by the Australian Competition and Consumer Commission on Friday, Apple described the argument as a “trojan horse”. Apple suggests this issue of fees, rather than the bank’s other demand for access to the iPhone’s communication antenna, is motivating the banks, who are all developing their own digital wallets to compete against Apple’s.

Digital wallets allow mobile phones to be used to pay through contactless payment terminals.

“Put simply, the applicant banks have the means, notice and opportunity to disadvantage Apple Pay by pricing Apple Pay transactions above transactions made using their own proprietary issuer digital wallets to dissuade cardholders from using Apple Pay,” Apple said. The banks have an “incentive to charge fees to consumers for using Apple Pay to steer customers towards their proprietary payment apps”.

Full Content: African Business Magazine

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