A number of major retailers and payments associations have filed letters in support of a regulatory request from three of Australia’s top four banks to compel Apple to negotiate with them as a group over third-party access to the iPhone’s NFC hardware, which is current used exclusively for the iPhone maker’s own Apple Pay contactless payments system.
In separate responses to the Australian Competition and Consumer Commission, Coles Supermarkets, the Australian Retailers Association, Bluechain, the Australian Payments Clearing Association and Australian Settlements Limited all voiced support in favor of establishing digital wallet access standards, ZDNetreports. The letters were posted as the ACCC denied the banks interim approval to negotiate last week.
The Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp, along with Bendigo and Adelaide Bank, last month filed a request with the ACCC to allow them to collectively negotiate with Apple to allow the installation of third-party digital wallet apps onto iPhone devices.
Such a deal would require Apple to open its closed and secure NFC technology up to third-party applications, such as bank cards, loyalty cards and such, developed by the applying banks. That technology is currently restricted to use only by Apple Pay.
“We note there has been an ongoing movement in Australia to improve the transparency of costs to consumers related to their banking products,” said Nikala Busse, Head of Payments at Coles. “We would envisage that activity that supports cost transparency or creates incentives to lower costs for the benefit of consumers would be in the public interest.”
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“In our view, for as long as Apple Pay remains the only app that can use the iPhone’s NFC functionality, the potential for innovation in mobile wallets and mobile payments will be limited,” ARA said. “A number of banks and merchants overseas have tried to develop mobile wallets and payment services using alternative technologies, but none have been successful.”
Letters from the APCA, ASL and Bluechain read much the same.
While payments processor PayPal also submitted an opinion, it didn’t endorse the banks’ request, instead it objected to the application’s definition of what a “mobile wallet” is, saying the definition in the application was too broad. PayPal also opined that the APCA’s voluntary Third Party Digital Wallet Security Industry Guidelines should not be mandated without an open discussion on standards.
Apple contends the banks’ application is related to one thing, competition from Apple Pay, which the company says is perceived as a threat, and the banks’ moves are merely a strategy to “blunt Apple’s entry into the Australian market.”
Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp have yet to sign on to offer Apple Pay to their customers. However, ANZ, the other member of the big four banks, broke ranks and signed with Apple for the contactless payments system. ANZ reportedly saw a 20% increase in online credit card and deposit accounts after offering Apple Pay support.
