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Why banks are paying Apple to use the new Apple Pay platform

Apple's signature mobile payments platform, Apple Pay, will receive a fee from banks each time a consumer uses Apple Pay to make a purchase rather than using their credit or debit card, according to the latest reports.

Several banks, including JPMorgan Chase & Co., Bank of America Corp. and Citigroup Inc. have agreed to integrate their cards into the Apple Pay system, reported Bloomberg (opens in new tab). Apple will reach individual agreements with each of the banks, detailing how the fee system will work. With the agreements in place the tech giant would have access to the $40 billion (£25 billion) market that banks generate yearly from "swipe fees".

Read more: Top 3 questions to ask when choosing a mobile payment system (opens in new tab)

Explaining why they'd pay Apple to use its Apple Pay service, Gavin Michael, JPMorgan's digital chief, told Bloomberg "the timing is right with customer behavior, the customer experience is right, and elements have come together around how the ecosystem is evolving for this to be a game changer. We've seen - certainly in our customer base - a drive to the mobile channel."

Apple's partnerships with Visa, MasterCard and American Express, mean that the Cupertino-based firm is already involved in the mobile payments infrastructure.

Jim McCarthy, head of innovation at Visa said, "given their [Apple's] ability to effectively manage their platform, and get folks across multiple industries, merchants, banks and networks to cooperate really was the thing that catalyzed the whole thing."

Read more: Visa payments with iPhone 6 and iPhone 6 Plus? It's confirmed (opens in new tab)