Australian banks denied interim approval to negotiate over Apple Pay
An Australian antitrust regulator on Friday temporarily denied a request from the country's three largest banks to collectively negotiate with Apple over the installation of third-party digital wallet software on iPhones.
The Australian Competition and Consumer Commission noted that the interim ruling has little bearing on a full decision currently scheduled for October, Reuters reports. Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp in July lodged a request for interim authorization from the ACCC as it awaits a formal ruling.
"However, given the complexity of the issues and the limited time available, the ACCC has decided not to grant interim authorisation at this time," said ACCC Chairman Rod Sims. "The ACCC requires more time to consult and consider the views of industry, consumers, and other interested parties."
The banks are collectively looking to negotiate terms under which Apple would allow installation of third-party digital wallet apps onto iPhone hardware, a process that requires access to the handset's NFC technology. Citing consumer safety, Apple restricts touchless NFC payments technology to its own in-house Apple Pay solution on all compatible devices. This limitation amounts to anticompetitive behavior, the banks argue.
In a response to the ACCC earlier this month, Apple said the banks' request to negotiate comes down to competition.
"Unfortunately, and based on their limited understanding of the offering, the [banks] perceive Apple Pay as a competitive threat," Apple said. "These banks want to maintain complete control over their customers. The present application is only the latest tactic employed by these competing banks to blunt Apple's entry into the Australian market."
All three banks pushing for access to iPhone's NFC tech have not yet signed on to offer Apple Pay to their customers. ANZ, the only big-four Australian bank to break rank and ink a deal with Apple, saw a 20 percent increase in online credit card and deposit account applications after rolling out Apple Pay support.
The Australian Competition and Consumer Commission noted that the interim ruling has little bearing on a full decision currently scheduled for October, Reuters reports. Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp in July lodged a request for interim authorization from the ACCC as it awaits a formal ruling.
"However, given the complexity of the issues and the limited time available, the ACCC has decided not to grant interim authorisation at this time," said ACCC Chairman Rod Sims. "The ACCC requires more time to consult and consider the views of industry, consumers, and other interested parties."
The banks are collectively looking to negotiate terms under which Apple would allow installation of third-party digital wallet apps onto iPhone hardware, a process that requires access to the handset's NFC technology. Citing consumer safety, Apple restricts touchless NFC payments technology to its own in-house Apple Pay solution on all compatible devices. This limitation amounts to anticompetitive behavior, the banks argue.
In a response to the ACCC earlier this month, Apple said the banks' request to negotiate comes down to competition.
"Unfortunately, and based on their limited understanding of the offering, the [banks] perceive Apple Pay as a competitive threat," Apple said. "These banks want to maintain complete control over their customers. The present application is only the latest tactic employed by these competing banks to blunt Apple's entry into the Australian market."
All three banks pushing for access to iPhone's NFC tech have not yet signed on to offer Apple Pay to their customers. ANZ, the only big-four Australian bank to break rank and ink a deal with Apple, saw a 20 percent increase in online credit card and deposit account applications after rolling out Apple Pay support.
Comments
Rejecting the interim request is at least a start. I'm not sure though that these three banks will even wave the white flag if their request is rejected by the formal ruling in October. They are greedy and power hungry and I suspect will only change course if their refusal to support Apple Pay starts to have a big enough impact on their bottom line.
Hopefully the number of customers moving from these three banks to ANZ in order to gain access to Apple Pay will start to have an impact on their decision making. Would also be great if some of the smaller banks, building societies and credit unions were able to support Apple Pay soon.
Then there's consultation around the draft and the full decision 2-3 months later.
As per ACCC release.
My understanding is: these three banks want to implement their own form of ApplePay on the iPhone. Pretty sure Mr. Cook will tolerate this as much as he tolerated the FBI's backdoor into the iPhone.
And it's also why the LNP are likely to try and stuff the ACCC at some point. As noted above, the current PM was a banker.
It's unlikely that any of the Big (4-1) will suddenly sign on. Then again, they're already in trouble over the last interest rate cut (and not passing it on to consumers), so they may soften over time to try and recover their public approval. Some of the Building Societies might sign on, though. Especially if they see it as a way to chip away at the banks.
In the meantime, I'm paying for most stuff with my AmEx, where I can. Still working fine, so far.
Customers are still using your cards but from a phone.
Obviously these banks aren't interested in customer security or reducing fraud.
There are plenty of reasons to shaft the useless ACCC that have nothing to do with banks. Name one decision of the ACCC in the last five years that has been effective or timely. Mr Sims has a good life though. And Turnbull will support an RC into the banks even if he doesn't have a clue why. and he wasn't a banker, btw. Just another bloody corporate lawyer.
for our foreign friends, the banks have applied to the ACCC to bargain collectively with Apple. The ACCC is able to do this, and often does with groups like chook farmers or dairy farmers who are only able to deal with a single processor. The banks want to do what the publishers were accused of in the iBooks case.
That the banks are trying this on, arguing their case is similar is laughable. But of course the useless ACCC couldn't give it the treatment it deserved and toss it immediately, because the ACCC want the treatment they believe they deserve, preferably for as long as possible. mr Sims has got to eat. Well.
http://www.news.com.au/technology/another-apple-pay-delay-for-australians-as-accc-wont-yet-let-banks-strike-a-deal-together/news-story/34b13deed78a2b6c70134def1e86215d
I've been lurking here for several years and finally feeling bold enough to speak up. I love the quality of debate on this site!
My $0.02 is that ever since the greedy banks destroyed my country's economy in 2008, I have zero (0) trust in the banks. Period. Having said that, and I'm a remote armchair observer, ANZ seems to be doing the right thing.
I'm too tired to look into the numbers - it's about 1:30 am here - but I suspect if these other Australian banks won't play ball due to their greed and desire for monopoly, it's probably not even worth doing business in Australia. Which is a shame for the Australian folks - I've had great experiences with Apple Pay.