| Visa Could Take a Bite Out of Apple Pay Fees|
Banks are pushing Visa to alter the way it processes some Apple Pay transactions, a change that would reduce the fees Apple receives from those institutions.
According to media accounts on Tuesday (Oct. 5), Visa plans to institute the change next year, although sources told The Wall Street Journal that executives at Apple oppose the change and are in discussions with Visa. If those discussions are fruitful, it’s possible the change won’t happen.
Currently, banks pay a fee to Apple when their cardholders use Apple Pay. If Visa implements the change, those fees wouldn’t apply to recurring payments for things like Netflix subscriptions.
The dispute is part of a larger tension between Big Tech and big banks. Companies such as Apple have been adding consumer payments to their services, with banks readily getting on board with them out of fear of being left behind. But sometimes those deals hit roadblocks, as seen last week when Google scrapped its plans to offer bank accounts to its users.
A company spokesperson said at the time that Google was moving its focus to “delivering digital enablement for banks and other financial services providers rather than us serving as the provider of these services.”
Sources told the WSJ that the tech giant decided to abandon the project due to missed deadlines, as well as the departure in April of a Google Pay exec who had been one of the plan’s biggest boosters.
Apple issued a statement saying that its “banking partners are an important part of Apple Pay’s growth,” and that those 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.”
This news comes just days after a report that researchers had uncovered a loophole in iPhones, which lets hackers make unauthorized contactless mobile payments by exploiting an Apple Pay feature that’s supposed to help users make quick payments using Visa cards.