Australian Retailers Back Banks' Right to Negotiate With Apple

Australian retail giant Coles, the Australian Payments Clearing Association (APCA), and the Australian Retailers Association have all expressed their support to allow some of the country's banks to collectively negotiate with Apple over access to its NFC-based digital payment technology (via ZDNEt).

Last month, Commonwealth Bank, National Australia Bank (NAB), and Westpac lodged a joint application with the Australian Competition & Consumer Commission (ACCC) to negotiate with Apple because they want to be able to use digital wallets they have already financed and developed, rather than be tied into using just Apple Pay.

Apple-pay-in-stores-amex
Apple lambasted the banks over the application, and last week the request was denied by the ACCC to give the antitrust regulator more time to consult and consider the views of all the parties involved.

However, in a letter of support sent to the ACCC, retailer Coles argued that giving the banks the ability to negotiate with Apple will enhance the experience for customers, as well as improve the transparency of costs related to credit card processing fees.

We believe the ability to tailor solutions for customers and provide them with greater value should be the driver for customer choice and not a technical lockout that many consumers may not have realized would be imposed when they purchased their mobile device.

The APCA also backed the banks, claiming enabling them to negotiate will encourage greater innovation and enhance competition in the payments markets, and ultimately deliver benefits to consumers and merchants.

"We consider that the exclusivity and restrictions on access to platforms and functionality, by contrast, may tend to stifle innovation and competition," it said.

Meanwhile, retail body ARA argued that if Apple allowed the banks to put their mobile banking apps onto the iPhone, it would give consumers the option to choose.

"We would like to see all customers have a choice of mobile wallets and payment services using the mobile phone they already have and the bank debit and credit cards and loyalty cards they already use," the ARA wrote.

PayPal also wrote to the ACCC, but rather than endorsing the banks' request for negotiations, it said the original application's definition of "mobile wallet" was too broad. The digital payments giant also wrote that the APCA's voluntary Third Party Digital Wallet Security Industry Guidelines should not be mandated without open discussions on standards.

Apple's opinion on the matter remained the same: the company believes the original application shows the banks want to maintain complete control over their customers and blunt Apple's entry into the Australian market.

Related Roundup: Apple Pay

Top Rated Comments

lchlch Avatar
99 months ago
Translation:
We don't want to pay any processing fees. We want to take everything ourselves.
Score: 20 Votes (Like | Disagree)
Rainbow Evil Avatar
99 months ago
Gotta love these banks' definition of more choice - the ability to choose the bank's wallet app while not supporting Apple Pay so that isn't an option.
Score: 16 Votes (Like | Disagree)
davemack Avatar
99 months ago
Coles, have a look at yourself! I used your "new" self-checkout interface today - it was the WORST!

You have no idea what is means to "enhance the experience for customers"...
Score: 14 Votes (Like | Disagree)
SurferPup Avatar
99 months ago
In Little Britain style, I hope Apple's response is, "iPhone says, nooo."
Score: 12 Votes (Like | Disagree)
fitshaced Avatar
99 months ago
If Apple don't want to negotiate with the Australian banks or open up the NFC chip, Apple if free to not sell the iPhone in Australia.
You make no sense
Score: 12 Votes (Like | Disagree)
uroshnor Avatar
99 months ago
Apple is just as bad - Apple could offer an API to access the NFC chip, or they could use Apple Pay , and its purely Apple's greed that that removes this. Apple is just as greedy as the banks.
If Apple offers hardware access to the NFC hardware in its current form, it would probably lose its EMVCo certification for Apple Pay. Apple went to a lot of effort to be certified at a card present level equivalent to full chip and pin (and thus is limited by your daily transaction limit).

Allowing other Applets would mean downgrading Apple Pay to the same scope/standard as pay wave / pay pass which is capped at around USD $ 50-100 per transaction in most countries.

Apple can't possibly pay for every bank in the world to be certified in conjunction with Apple Pay on the device, and EMVCo certification may not be something a bank wants to do. The Australian banks have tried to shut out MasterCard and Visa from the Australian market previously with their "Bankcard" consortium.

My best guess is Apple's current implementation is based on hardware they don't intend to keep in the product line. As the NXP chipset duplicates functionality in the SEP, I can see Apple wanting to eventually migrate to their custom chipset.

Note that Apple does not give anyone access to NFC under any circumstances , even for functionality that does not compete with ApplePay (eg access control systems). Nor do they give raw access to GPS, Bluetooth, Ethernet , Wifi or Cellular to any 3rd party.

I don't think the Australian Banks have a leg to stand on here.
Score: 12 Votes (Like | Disagree)

Popular Stories

iPhone 16 Camera Lozenge 2 Perspective Gray

Five Key Upgrades Coming to iPhone 16

Friday March 15, 2024 1:45 pm PDT by
The iPhone is Apple's top-selling product, and it gets an update every year. In 2024, we're expecting the iPhone 16 and iPhone 16 Pro lineup, with an arguably more interesting feature set than we got with the iPhone 15 and iPhone 15 Pro. Subscribe to the MacRumors YouTube channel for more videos. Capture Button All four iPhone 16 models are set to get a whole new button, which will be...
When To Expect New iPads Feature 1

Apple to Announce New iPads on March 26, Rumors Claim

Monday March 18, 2024 4:02 am PDT by
Apple is widely expected to release new iPad Air and OLED iPad Pro models in the next few weeks. According to new rumors coming out of Asia, the company will announce its new iPads on Tuesday, March 26. Chinese leaker Instant Digital on Weibo this morning 日发布%23">claimed that the date will see some sort of announcement from Apple related to new iPads, but stopped short of calling it an...
airpods 3 orange

Two New AirPods 4 Models Expected to Launch in September or October

Sunday March 17, 2024 7:56 am PDT by
Apple suppliers will begin production of two new fourth-generation AirPods models in May, according to Bloomberg's Mark Gurman. Based on this production timeframe, he expects the headphones to be released in September or October. Gurman expects both fourth-generation AirPods models to feature a new design with better fit, improved sound quality, and an updated charging case with a USB-C...
iphone se 4 modified flag edges

iPhone SE 4 Expected to Depreciate Heavily

Tuesday March 12, 2024 9:04 am PDT by
Resale value trends suggest the iPhone SE 4 may not hold its value as well as Apple's flagship models, according to SellCell. According to the report, Apple's iPhone SE models have historically depreciated much more rapidly than the company's more premium offerings. The third-generation iPhone SE, which launched in March 2022, experienced a significant drop in resale value, losing 42.6%...
General iOS 17 Feature Orange Purple

iOS 17.4.1 Update for iPhone is Imminent

Monday March 18, 2024 5:27 am PDT by
iOS 17.4.1 and iPadOS 17.4.1 should be released within the next few days, with a build number of 21E235, according to a source with a proven track record. MacRumors previously reported that Apple was internally testing iOS 17.4.1. As a minor update for the iPhone, it will likely address software bugs and/or security vulnerabilities. It is unclear if the update will include any other changes. ...
M3 iPad Feature 3

New iPads Likely to Begin Shipping in April

Monday March 18, 2024 9:52 am PDT by
Apple's new iPad Pro models with OLED displays will likely begin shipping to customers in April, according to information shared today by Ross Young, CEO of display industry research firm Display Supply Chain Consultants. Bloomberg's Mark Gurman also said the new iPad Pro models might not ship until "deeper" into April in his Power On newsletter on Sunday:I've repeatedly said that new...
iOS 17 Passkey With Apple ACCOUNT Feature

'Apple ID' Expected to Change to 'Apple Account' Starting With iOS 18

Sunday March 17, 2024 7:13 am PDT by
MacRumors was first to report that Apple was planning to rebrand "Apple ID" to "Apple Account" across its software platforms and websites like iCloud.com as early as this year, and now Bloomberg's Mark Gurman has corroborated this change. A mockup of the new Apple Account branding In his Power On newsletter today, Gurman said the new "Apple Account" branding will start to be used later this...