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ACCC Investigating Apple Pay

The Australian Competition and Consumer Commission has officially launched a formal investigation into how Apple’s ‘tap and go’ feature on iPhones controls bank access.

As it stands, the ‘tap and go’ payment feature will only allow bank cards to connect to payment terminals if the cards are stored within Apple’s digital wallet. Therefore, in order to pay using an iPhone, a customer must use Apple Pay. Apple charges banks a fee to route their cards through Apple Pay.

The ACCC sees this as a problem, and so does the Commonwealth Bank, who raised the concerns.

“We are investigating that issue that the Commonwealth Bank has raised,” ACCC Chairman Rod Sims told the AFR.

“It is a classic, complicated competition issue in the sense that you get a party like Apple that builds up its own internal business system, but then they get so big that you say, ‘hang on, is what you did when you were small still appropriate when you are big?’ It is an issue we are looking at.”

CommBank CEO Matt Comyn first raised the issue in parliament last month, saying that iPhones were used in 80 per cent of smartphone ‘tap and go’ payments, and by restricting these payments to the Apple Pay system, they are restricting competition.

“Australians who use Apple devices should be able to make their own decisions about which features they prefer in a wallet app, as Android users can. Yet currently they cannot,” he said.

“Given their enormous resources and technical capability, I find it difficult to believe they couldn’t provide reasonable access in a secure way.”

Comyn also wants Apple regulated by the Australian Securities and Investments Commission in the same way the banks’ own digital payments are, under the ePayments Code.

Apple says Comyn’s comments “included misleading and false statements about Apple Pay and our business in Australia which Apple seeks to correct.

“Sadly, it is evident from comments made during this inquiry that Apple’s focus on what’s best for customers is not always a priority shared by others.”

It is estimated that Apple takes $100 million a year in fees from banks.


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