Apple Pay Losing Ground in Australia as Banks Play Hardball

Apple Pay Losing Ground in Australia as Banks Play HardballAustralia’s major banks are playing hardball in negotiations with Apple to let the latter’s Apple Pay mPayment platform into the country. The big four don’t want to give Apple the share it wants of their transaction fees.

In the US, national banks tend to take about a dollar for every $100 in transactions, whereas Australia’s major banks take only half that in interchange fees. As such, they’re reluctant to give much away to Apple, which negotiated a deal to take 15 cents for every $100 in the US and a much smaller fraction of every £100 in the UK, where the service recently launched.

Another part of the Australians’ argument is that their country already has similar platforms available, and that that has been the case for years. Some banks even have NFC mPayment functionality through their mobile apps, providing essentially the same service offered by Apple Pay.

Meanwhile, Apple’s rival PayPal is making inroads. Earlier this summer the company teamed up with financial services tech provider Tyro to essentially enable mPayment services with 14,000 merchants in the country. If Apple continues to lose ground as the negotiations proceed, it may end up taking a smaller share of interchange fees than it had aimed for; in any case, it seems unlikely to abandon the Australian market altogether.

Source: Business Insider