Apple Pay alleged “anticompetitive” practices bring headaches in the US

Apple Pay

Apple probably is familiar with legal battles every year. A few days ago, the company was sued by an Irish company for allegedly violating some of its patents. Now, the company is being sued by Iowa’s Affinity Credit Union in the US. Apparently, this may turn into a class action lawsuit that is similar to a charge in the EU way back in 2021. The Union accuses Apple of adopting anticompetitive conduct in the Apple Pay operation.

The charge states that Apple coerces owners of its phones, tablets, and watches to use Apple Pay. Furthermore, it allegedly prevents other payment services from competing on its platforms. This has led to 4,000 banks and credit unions in the US using Apple Pay. These operators are paying at least $1 billion of excess fees each year. The action also cites rival services on Android and their zero charges. Meanwhile, Apple charges a 0.15% fee on credit transactions and a flat 0.5-cent fee on debit transactions.

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However, the lawsuit is not just concerned about the money and the number of fees. It cites the lack of competition that removes the incentive for Apple to improve Pay and make it more secure. The other services can’t really compete, and Apple sits in a comfortable place that makes innovation unnecessary. As a result, Apple users and issuers of payment cards that work with Pay are “easy targets” for future security flaws.

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Apple Pay

The lawsuit seeks triple damages and a stop to Apple’s anticompetitive behavior. This will require the company to open up the full mobile payment capabilities of Apple hardware to third-party payment services. Obviously, this won’t be an easy task.

Apple recently has been a target of multiple lawsuits, from the aforementioned patent infringement to Russia-related services. We’ll keep following these cases and see how they will advance soon.

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