Apple has made a surprising move in Europe, proposing to open its Near Field Communication (NFC) payment technology to third-party developers. This means that for the first time, rivals to Apple Pay will be able to offer their own contactless payment on iPhones in Europe.
This is a significant shift, considering Apple’s historically closed ecosystem. The move comes amidst antitrust charges from the European Commission, which accused Apple of stifling competition by restricting access to its NFC chip.
Over the next few months (and years) we are likely to see banks, fintechs, and established players scramble to develop innovative solutions, vying for your digital wallet real estate.
What does this mean for users in Europe?
- More choices: Users will have a much wider range of payment options beyond Apple Pay. Banks, fintechs, and other payment providers can now develop their own iOS apps that leverage the iPhone’s NFC chip for contactless payments
- Potential for innovation: With more players in the game, we might see exciting new features and functionalities in mobile payments, such as budgeting and spending insights, loyalty programs integrated seamlessly into payment apps, or personalised offers triggered at the point of sale.
Increased competition: This could lead to lower fees and better deals for consumers as payment providers compete for your business.
But, wait, there’s more…
- Apple’s terms and conditions still apply: While third-party developers gain access to NFC, Apple will still set the rules and take a cut of transactions. The exact terms are yet to be finalised
- Impact on Apple Pay: It’s unclear how this will affect Apple Pay’s market share. While some users might be drawn to new options, Apple Pay’s convenience and tight integration with the Apple ecosystem could still be a major draw
- Global implications: The EU ruling only applies to Europe for now. It remains to be seen if Apple will extend this openness to other regions facing similar antitrust scrutiny.
Apple’s decision to open up NFC payments in Europe is a positive step for consumers and the mobile payments landscape. It fosters competition, opens doors for innovation, and gives iPhone users more choices. However, it’s important to remember that Apple is still calling the shots, and the long-term impact remains to be seen.
