Apple Pay, the Cupertino company's mobile payment service, is still available in very few countries around the world. One of the main reasons that explain the slowness of its expansion is in the negotiations to reach firm agreements with the different banking entities. In Spain, the arrival of Apple Pay was expected by the end of 2016, something that has already been completely ruled out and that we will not see, with some luck, until some indeterminate moment in the first quarter of 2017.
Meanwhile, although in Australia Apple Pay has been available for a year now, The Australian Competition and Consumer Commission has formally rejected an authorization that would allow the three largest banks in the country to jointly negotiate access to Apple Pay technology, a quite logical decision inasmuch as it would leave the rest of the smaller entities at a clear disadvantage.
The "finely balanced" decision of the Australian Competition and Consumer Commission (ACCC) marks a turning point for months of dialogue and negotiations between the country's "big three" banks and Apple.
The opinion issued by the ACCC rejects a proposal presented last July by the three largest financial institutions in Australia, the Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp, together with Bendigo and Adelaide Bank, to jointly negotiate the terms of the relationship between them and Apple Pay.
In this request there were some aspects that the ACCC did not seem to like at all, and that the users would not have liked at all if they occurred. The main of these pitfalls seems to be the access to the iPhone's NFC driver, allowing banks to place their own digital wallet systems on iPhone devices, a measure that would suppose a high competition according to this organism.
But in my opinion, the claims that these banks had in relation to commissions and who would be responsible for them are much more serious. In the application filed in July, These banks were requesting permission to negotiate a possible withdrawal or modification of restrictions that prohibit financial institutions from diverting Apple Pay transaction fees to consumers.. That is, lose apply commissions directly to users.
Rod Sims, Chairman of the Australian Competition and Consumer Commission, noted that "Currently, the ACCC is not satisfied that the likely benefits of the proposed conduct outweigh the likely harms." In other words, the intention of the banks could do more harm than goods. He continued: "While the ACCC accepts that the opportunity for banks to bargain and collectively boycott would put them in a better bargaining position with Apple, the benefits are currently uncertain and may be limited."
The affected Australian banks have already spoken out about this decision. In statements to Apple Insider point out that they will continue to work with the ACCC in order to overcome the differences raised by it and to be able to offer their clients competence and freedom of choice since according to the banks, if the ACCC proposal is in effect, iPhone owners in Australia will have only one mobile wallet option, Apple Pay, while the Australian payments industry will be denied the opportunity to innovate and compete with Apple.
If the Australian competition regulator's determination project stands, there will effectively be no competition against Apple for mobile payments on the iPhone. The request has never been about preventing Apple Pay from coming to Australia or reducing competition between wallets. It has always been about the offering of consumer choice and innovationsaid Lance Blockley, a payments specialist representing the banking community.
However, the ACCC, it is clear, does not think like the banks. In fact, the Australian antitrust body has determined that Apple Pay could stimulate competition in the growing space of digital payments: “Apple Wallet and other non-bank digital wallets could represent a disruptive technology that can increase competition between banks by facilitating consumers switch between card providers and limit any blockages that banks 'digital wallets can cause.'
Apple Pay launched in Australia last November through a limited partnership with American Express. Major bank ANZ was the first to partner with Apple in April.
Until an amicable agreement on Apple Pay is reached, Banks can now offer digital wallet solutions on the iPhone without accessing the NFC module, through their own applications integrated with Apple Pay. The ACCC's final decision is expected to come in March 2017