Anticompetitive Apple Pay: the European complaint was supported by PayPal

The European Commission this week accused Apple of stifling competition by reserving its NFC chip for Apple Pay in terms of payments. Bloomberg reveals today that the complaint was partly launched following an intervention by PayPal.

PayPal is behind European criticism for Apple Pay and the NFC chip

PayPal has turned to the European Commission to raise concerns about Apple’s practices with contact payments. This prompted the European executive to look into the subject as early as June 2020 by opening an investigation and this continues today. The Commission considers that Apple is in a situation of abuse of a dominant position on the iPhone mobile payment market.

With iOS, Apple has a different policy than Android. On iOS, only Apple Pay can take advantage of the NFC chip for contactless payments. On Google’s mobile operating system, any bank or other institution can use NFC for its own payment system. With Apple, banks have to go through Apple Pay and nothing else.

This year, Apple will allow third parties to use the iPhone’s NFC chip to accept payments — a feature aimed at small businesses like merchants — but the company still won’t allow consumers using competing services to make payments from this way. This situation creates unequal treatment, according to the European Commission.

For its part, PayPal has a contactless payment service on Android. The group cannot offer the equivalent on iOS because of Apple’s blockage, hence its reaction to the European Commission.

In its defense, Apple says that Apple Pay is compatible with 2,500 banks in Europe and assures that its system is secure. The manufacturer implies that opening the NFC chip to third parties could have an impact on security. This doesn’t really seem the case on the Android side.