Mobile

Banks Went The Apple Way

The mobile payment relationship between the major banks and Apple is, to put mildly, a delicate one. Apple’s move has the potential to vastly increase mobile payment revenue, which would create a potentially highly lucrative new market for the banks. But the precise details of early negotiations have the potential to color the nature of those deals for years. As the smoke clears from Round One, it appears that the banks chose to start by playing this game the Apple way.

“For the banks and credit card networks, Apple Pay could threaten some revenue streams, as the technology giant looks to assume a more central role in the financial universe,” reported The New York Times. “But the eager participation of banks and card companies suggests both Apple’s clout, and the recognition among financial institutions that they face broader challenges from upstart technology ventures, many of which are not as eager or willing as Apple to work with the incumbent financial industry.”

The story quoted James Anderson, the senior vice president for mobile product development at MasterCard, saying: “There are schemes that don’t respect and honor the payment networks. We want to invest in programs that respect our role in the ecosystem.”

The banks, the story said, are “hopeful that they will make up for the lower rates by processing new types of transactions that are currently being done with cash or other payment methods.”

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