NEW YORK–Many of the financial institutions that rushed to work with the Apple Pay mobile wallet when it debuted in 2014 now have some “regrets,” according to one new analysis.
As did many credit unions, when Apple Pay launched big banks such as JPMorgan Chase and Bank of America signed on, agreeing to pay fees that would allow their cardholders to pay by iPhone. Banks agreed to pay Apple 0.15% of each purchase made by their credit cardholders, and pay a separate fee on debit-card transactions.
‘Grown Unhappy’
“But some banks have grown unhappy with the costs, especially after Apple introduced its own credit card in 2019, according to people familiar with the matter,” the New York Times reported. “Some banks are pushing back, nudging…Visa to change the way it processes certain Apple Pay transactions, according to some of the people. The change would trim the fees that banks pay to Apple.”
The Times reported Visa plans to implement the change next year, based on documents viewed by The Wall Street Journal.
“Apple executives have told Visa executives they oppose the change, the people said,” the Times stated. “The two companies are in discussions and it is possible the planned change won’t kick in.
“Currently, banks pay Apple a fee when their cardholders use Apple Pay,” the report continued. “Under the planned new process, the fees wouldn’t apply on automatic recurring payments such as gym memberships and streaming services.”
‘Long Running Tension’
The Times noted the dispute “reflects a long-running tension” between the giants of tech and finance. \
In response, Apple issued a statement to the Times, “Our bank partners continue to see the benefits of providing Apple Pay and invest in new ways to implement and promote Apple Pay to their customers for secure and private in-store and online purchases.”