What future for Apple Pay in France ?

© Apple

Clearly, the European Commission is not giving Apple any respite. After being fined 1.84 billion euros for unfair competition with Spotify (and other music streaming platforms), it is now Apple Pay which is in danger with the imminent entry into force of the DMA (Digital Market Act).

This new European text aims to limit the monopoly of digital giants, like Google, Apple, Facebook (Meta), Amazon and Microsoft. By implementing the DMA, the European Commission intends to strengthen competition in order to give companies that do not have the scale of GAFAM and other behemoths a chance to take part in the digital economy. The DMA has not even come into force yet, the rules of the game are already changing for these behemoths.

If the European Commission has validated the unfair competition practiced by Apple towards music streaming platforms like Spotify, senior representatives from Brussels are now pointing the finger at Apple's abuse of dominant position with regard to Apple Pay.

With the entry into force of the DMA, Apple Pay's monopoly is faltering. According to an extremely interesting analysis by iGeneration, this could push some European banks to abandon Apple Pay.

The end of Apple Pay in Europe ?

Today, it is possible to pay directly from your smartphone (or even your connected watch), and it's extremely practical. Unlike Android devices, being able to pay with your iPhone is expensive for banks.

Currently, the Cupertino company imposes restrictions on mobile payment and NFC chips in iPhones. To put it simply: if you want to pay with your iPhone, you must use Apple Pay. No alternative is possible… Until now, at least.

Not only does this leave the user with no choice, hello abuse of dominant position, but it forces the banks to pay. The latter must pay a commission on each payment made with Apple Pay (between 0.05% and 0.20% depending on the establishment and the type of card) but also a tax as soon as a bank card is saved in the Apple Maps application. The problem is that banks didn't really have any alternatives until now. Considering the weight of the Cupertino company, they had to comply with these rules of the game.

But the entry into force of the DMA could change everything. Apple will have to relax its restrictions to comply with the new European text and, thus, open the iPhone's NFC chip to other payment services. According to iGeneration, this could be good for European banks.

The European Payment Initiative (EPI) group is currently working on a unified payment solution in Europe, the Wero application. Several major French banks support this project: La Banque Postale, Crédit Agricole, BPN Paribas and Crédit Mutuel to name just a few. The opening of Apple's NFC chip could allow the EPI group to successfully realize its project. In this case, several banks linked to EPI could choose to leave Apple Pay.

If some will not want to do without Apple Pay, which will surely remain widely used by iPhone owners, this change could allow banks to vigorously renegotiate with the Cupertino company. Yes, they will now have a more balanced balance of power. Still, this redistribution of the cards in the game could change consumers' payment habits.

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