The UK Competition and Markets Authority has called for Apple to expand access to its contactless payment technology and substantially reduce the fees charged to companies utilizing the system. The watchdog contends that Apple’s current pricing structure and access restrictions are preventing financial technology firms and other developers from creating new products and services, thereby hampering innovation and competition in the digital payments sector.
Apple has countered that broadening access could compromise security standards and maintains that its existing framework does not impede innovation. The company stated that developers and financial institutions in the UK and globally have been able to securely offer contactless transactions within their applications, covering use cases ranging from retail payments to transit passes, vehicle access, and event ticketing.
The CMA’s proposed measures would require Apple to permit applications using Host Card Emulation, an alternative contactless technology standard that Apple currently does not allow in the UK market. The regulator argues that opening up this technology could enable development of account-to-account payment systems, digital identification tools, travel passes, and digital key solutions. The UK’s fintech sector generates substantial economic output, the authority noted, making regulatory action particularly significant for the industry’s growth potential.
The CMA pointed to developments in the EU following similar regulatory requirements, where alternative payment applications including Vipps, PayPal, Klarna, and Curve launched following Apple’s technology opening. However, no comparable competitor products have emerged in the UK market despite it being a leading fintech hub. Apple disputed the connection between regulatory changes and new market entrants, suggesting these applications could have launched previously.
The CMA clarified it is not seeking to directly set pricing but expects its proposals would naturally result in fee reductions. The authority emphasized that removing barriers to market entry could foster conditions for British companies to develop innovative products and services.
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