Banking News

ACCC postpones decision on banks versus Apple

(18 August 2016 – Australia) The Australian Competition and Consumer Commission (ACCC) has said that it requires more time to make a final decision on an application by three of the country's big four banks who seek access to Apple iPhones near field communication (NFC) hardware so that they can provide mobile wallets to the customers.

ACCC chairman Rod Sims said: "Given the complexity of the issues and the limited time available, the ACCC has decided not to grant interim authorisation at this time. The ACCC requires more time to consult and consider the views of industry, consumers, and other interested parties.

"The ACCC's decision not to grant interim authorisation at this time is not indicative of whether or not a draft or final authorisation will be granted."

Commonwealth Bank of Australia (CBA), Westpac Banking Corporation (WBC), National Australia Bank (NAB), and Bendigo and Adelaide Bank asked the regulator last month to provide "interim authorisation" for them to form a cartel to collectively negotiate with Apple.

The Silicon Valley-based firm has favoured its own digital payment service, Apple Pay, over the banks’, effectively locking them out of the device.

The banks want Apple to take more responsibility for fraud losses, want to talk to Apple about industry standards for digital wallets, and want to be able to pass on fees charged by a third party digital wallet provider.

To provide their own payment services on iPhones, the banks are seeking access to the devices NFC antennae. However, Apple says providing that access would compromise the security of Apple's hardware. "The present application is only the latest tactic employed by these competing banks to blunt Apple's entry into the Australian market," the technology giant said.

It has been reported that the banks also want to keep as much of their interchange fees as they can for cards loaded onto Apple Pay, but the issue of fees was not included in the ACCC application, with the banks saying fees remain an issue for each individual bank to negotiate.

A spokesperson for the banks said they will continue to be in consultation with the regulator until the final determination is made. Adding that the banks want "to ensure that Australian customers are able to choose between different mobile wallets to make payments easily," he said.