Banks Seek Changes to Apple Pay Fees

Advertiser Disclosure Editorial Disclosure

A new report in the Wall Street Journal is highlighting growing frustration from many banks towards Apple Pay. The mobile wallet platform, which enjoys widespread popularity and significant market share, earns Apple a transaction fee on every purchase – giving the tech giant significant revenue, despite a potentially reneging on a 2014 pledge not to compete with other cards with the Apple Card.

Banks Pressuring Visa on Apple Pay Fees

Apple received several concessions from credit card issuers and payment networks when it first launched its Apple Pay platform in 2014. Chief among these concessions was an agreement by banks to pay Apple 0.15% of each purchase made with their cards through Apple Pay. In exchange, Apple agreed not to launch a credit card network, a la Visa or Mastercard.

The launch of the Apple Card, however, has caused significant headaches for many banks. These card issuers now view Apple as a direct competitor, meaning Apple has a distinct advantage in the market, particularly as Apple enjoys the benefits of getting paid for purchases made with non-Apple Cards while receiving the additional proceeds from Apple Card itself.

Visa Considering a Change to Charges On Apple Pay

The Wall Street Journal is now reporting that many banks are lobbying Visa to change how Visa issues tokens for ‌Apple Pay‌ cards. These new changes, the banks argue, would make the Apple Pay platform (and the fees it charges) a more equal playing ground.

According to the report, Visa is considering changes to see Apple receive a transaction fee on an initial subscription payment and not on subsequent transactions. Reducing the fees banks pay to a one-off payment would level the playing field and reduce Apple’s financial advantage. Currently, Apple Pay makes the majority of its revenue from the 0.15% transaction fee.

Related Article: Mastercard Installments Buy Now Pay Later Revealed

Featured image by mohamed_hassan/ PixaBay

About: Cory
Cory Santos

Cory is's "Jack of all trades" and resident credit expert, covering all facets of the credit card space. Cory holds academic degrees in both the U.S. and U.K. In addition to credit cards, Cory finds that jogging, cats, and memes are essential parts of a balanced day.

Advertiser Disclosure

BestCards is an independent, Florida-based credit card comparison platform. Many of the card offers that appear on this site are from companies from which BestCards receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). BestCards does not include all card companies or all card offers available in the marketplace.