20 Apr 2024 3 min read

Open NFC payments on iPhone

I'm largely on board with much of the current raft of regulation against the big tech companies in the EU, I think there has already been some positives to come of it, even if there are - as is to be expected - some questionable aspects to some of these regulations.

There is one that worries me a little for purely selfish reasons, and that's the requirement that Apple must allow third party developers to be able to develop their own NFC payment applications.

(No, I have not forgotten about Brexit and that this won't impact me here in the UK yet, but this sort of regulation is contagious, so I'm expecting it to happen here too.)

On the surface, this is a good thing. More choice, more opportunities for others to offer competition and forcing Apple itself to compete, rather than simply owning a rather large and important market.

However... Apple Pay is a great user experience. It's some of the most reliable, convenient and helpful technology I use on a daily basis. What I worry about is banks and credit card issuers removing Apple Pay support in favour of their own applications - fragmenting the experience significantly.

We saw this on Android, where Android Pay/Google Pay weren't the only options - banks such as Barclays held out for a very long time on enabling support for Google Pay, I believe only recently doing so for the debit cards - with their credit cards still absent and requiring the use of the Barclaycard app. (It's been many years since I was an Android user, so forgive any errors here).

A situation where some of my cards might require specific apps that can only be enabled one-at-a-time will make things just a bit worse for me and I assume many others. This is what I selfishly worry about.

Whilst I am in favour of forcing Apple to open up their platform and loosen the grip they have on some important markets, I do also recognise there are some advantages as users that we might lose and unfortunately Apple does seem to be applying a level of malicious compliance to some of the EU's rules. They want users to experience a bit of pain, they want their users to direct their anger to legislators.

The scenario where banks and credit card issuers begin to limit NFC payments to their own apps, and iOS only allowing you to have one NFC payment application enabled at a time (be it Apple wallet or a bank specific application), does not - to me at least - seem like the only possible scenario.

Apple wallet could become a proxy for NFC payment applications, if, Apple wanted it to. This would require them to forgo a sizeable revenue stream for banks and credit card issuers that wanted to limit their cards to their own NFC payment applications - as Apple supposedly takes a 0.15% fee for each transaction.

But maybe they'll have no choice? Maybe in markets where they're forced to open NFC payments up - the banks and credit card issuers will take back control and force Apple to make a choice: Hold on to your transaction fee of a potentially small number of banks/cc issuers and make NFC payments an exclusive choice for customers, or fix this UX problem by introducing the ability for Apple wallet to be a proxy for 3rd party NFC payment applications.