Australian banks have lost their epic battle with Apple Pay

Australian banks
The banks had been attempting to negotiate with Apple

A group of powerful Australian banks have lost their battle with Apple Pay after the country’s consumer commission denies their authorization to collectively bargain

A new ruling by the Australian Competition and Consumer Commission has denied a request by the Australian banks, Commonwealth Bank, Westpac, National Australia Bank, Adelaide and Bendigo Bank to bargain with Apple and boycott Apple Pay collectively.

The banks had been attempting to negotiate with Apple to allow iPhone users to make payments from their own integrated digital wallets. However, due to anti-cartel laws in Australia, the banks will be required to negotiate individually with Apple as opposed to in a group. The ruling will likely mean that the global tech giant will retain full control of its payment technology in the country.

According to ACCC chairman Rod Sims, “The ACCC is not satisfied, on balance, that the likely benefits from the proposed conduct outweigh the likely detriments. We are concerned that the proposed conduct is likely to reduce or distort competition in a number of markets.”

“While the ACCC accepts that the opportunity for the banks to collectively negotiate and boycott would place them in a better bargaining position with Apple, the benefits would be outweighed by detriments,” he continued.

The group of Australian banks had argued that without direct access to the iPhone’s NFC technology they would not be able to offer their own integrated digital wallets to iPhone customers. The banks persistently stated that this would shut down competition in the Australian mobile payments market and stop innovation and investment in digital wallets.

Apple refused to allow direct access, saying that opening access to the iPhones NFC function would undermine security and customer experience. In past filings with the Australian Competition and Consumer Commission, the company argued that Australia’s largest banks were attempting to avoid paying the fees associated with using Apple Pay, rather than trying to access the iPhones NFC technology to ensure competition.

More here [ACCC] [finextra]


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