The Payment Expert Podcast examined the CMA’s proposals to open iPhone contactless technology to rival wallets, why Apple’s existing UK access has drawn no competitors, and what wider access could mean for pay by bank and digital ID.
The Competition and Markets Authority (CMA) set out proposals on 20 October that would require Apple to give rival firms access to the iPhone‘s near field communication (NFC) technology. The company offers UK developers only secure element (SE) access, which keeps payment data on a chip inside the phone, and the CMA wants it to also offer host card emulation (HCE), which lets providers build a wallet in software.
The podcast discussed why no rival wallet has launched in the UK, even though Apple opened NFC access to developers here in 2024. Firms looking to compete with Apple Pay, which holds preferred access to the iPhone’s NFC chip, had to use the SE and pay Apple’s fees, which made a rival wallet a poor business case.
The CMA has not set a price, saying only that it expects fees to be substantially lower than Apple’s current charges. The podcast said this leaves room for a long negotiation between Apple and the regulator, while UK Finance has called for some free access to NFC, as is the case in the EU.
EU rivals launched within six months
Apple said it does not believe the CMA “should require it to adopt an approach with lower privacy and security protections”. The podcast said the argument no longer holds because Android has used HCE since 2013 and EU iPhone users have had HCE wallets since 2024 with few issues.
After Apple agreed in July 2024 to give free HCE access in the EU, Vipps launched the first rival wallet within six months and was followed by PayPal, Klarna, Curve and BBVA, according to the CMA.
The podcast expects fintechs such as Revolut and Monzo to move first in the UK because a wallet keeps customers inside their apps, while banks could launch their own to avoid the fee the company takes on card transactions made through Apple Pay. Winning over UK consumers who already use Apple Pay for most purchases would be the harder task, the team discussed.
Pay by bank and digital ID
Pix users in Brazil can tap to pay on Android but are limited to QR codes on iPhone, and Apple has held talks with Brazil’s competition authority over NFC access for Pix. The podcast said a government-backed instant payment system running on tap-to-pay points to a similar option in the UK, where wider NFC access could let pay by bank providers accept payments at card terminals.
HCE access could also allow the government or another provider to hold digital ID credentials in its own wallet, such as the GOV.UK Wallet, rather than relying on a private company’s, the podcast said.
The consultation closes on 17 November, and UK rivals could launch around six months after a final decision, following the pattern seen in the EU.
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