Apple Fires Back at Australian Bank “Cartel” Challenging Apple Pay

Last month, four of Australia’s biggest banks—Commonwealth Bank of Australia, National Australia Bank, Westpac Banking Corp, Bendigo and Adelaide Bank—joined forces and turned to the country’s competition regulator, to engage in forcing Apple to open up its NFC chip for Apple Pay access.

Apple has recently responded to these Australian banks, in a response to the Australian Competition and Consumer Commission (ACCC). Essentially, as what we expected, Apple says opening up NFC to third parties such as these Australian banks would be a security risk, writes local head of Apple Pay, Marj Demmer, in a three-page filing (via AFR).

In its submission, Apple stated “Our hardware, software and services are built in a deeply integrated manner so we can provide the highest possible security.”

On top of the security risk, Apple explained if the ACCC granted this “cartel” permission to force Apple to open up NFC, it would also be an anti-competitive move for consumers, since these four banks make up 66% of Australian credit card balances and 70% of household deposits:

“The request by the application banks would slow innovation and reduce choices by protecting members of the cartel from competition with each other,”


“Allowing the banks to form a cartel to collectively dictate terms to new business models and services would set a troubling precedent and delay the introduction of new, potentially disruptive technologies.”

Apple revealed it started negotiations with Australian banks in late 2014, but since then, the latter group “[has] not come to terms” with the company. The company states these banks have a “limited understanding” of Apple Pay:

“Unfortunately, and based on their limited understanding of the offering, the [banks] perceive Apple Pay as a competitive threat. 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,”

ANZ Bank is the sole Australian bank part of Apple Pay, surprising its fellow competitors by launching support back in late April for American Express cardholders.

It took a while for Canada’s Big 5 banks to support Apple Pay, but it happened this summer. Looks like our banks realized what these Australian banks haven’t—NFC access on the iPhone will remain only for Apple Pay, and not third parties.

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