Europe’s new anti-Gafa weapon breaks a lock in payments

This is a detail of the Digital Markets Act (DMA), the new European legislation on digital markets. But for the payments industry, it means a lot. At the heart of this text which aims to regulate the giants of the Net and on which the Commission, the Parliament and the European Council agreed on Friday, is indeed a measure which will open the doors of the iPhone to the actors of the payment.

Until now, they did not have access to a key technological element of Apple smartphones: the NFC (near field communication) antenna which notably allows them to pay in stores using their mobile phone as a payment card. . The Californian group reserves its antenna for its own payment solution, Apple Pay. But DMA will change that.

Concretely, the Internet giants will no longer be able to “force application developers to use certain services in order to be listed in application stores” and will have to “allow application developers to access the functionalities under fair conditions. auxiliaries of smartphones (NFC chip, for example)”, states the press release from the European Council.

Strengthen the competition

“We had fears that the European institutions would retain this aspect, because the subject could have seemed incidental to some, comments Arno Pons, head of the think-tank Digital New Deal, which defends a recovery in hand of sovereignty. digital. So it’s a good surprise that it’s there. »

The impossibility of accessing the NFC antenna of the iPhone is one of the reasons why PayLib, the payment solution launched on the initiative of several large French banks, is still slow to take off in store payment by smartphone. Its leader, Vincent Duval, has long denounced this situation, which deprives his company of fair access to part of the market, since 20% of smartphone users are equipped with an iPhone in France.

Open payment

In reality, this text will reopen the game of competition to the entire payment ecosystem, such as split payment applications (Buy Now, Pay Later or BNPL). On this booming segment, in the absence of DMA, Apple could once again have imposed its own solution, integrated into Apple Pay. The Cupertino company is in the process of polishing its weapons in terms of BNPL: it has just acquired one of the British specialists in credit analysis, Credit Kudos, with a view to developing a solution for Europe.

Other types of applications will also be able to develop. “Ile-de-France Mobilités fought for a long time against Apple on the subject”, recalls a player in the payment sector. Indeed, Apple’s refusal to open its NFC antenna also prevents the implementation of open payment, which some public transport companies would like to implement in France. This is the possibility of validating, with your contactless payment card, your journeys on public transport, the fare adjusting itself according to the duration or the number of journeys made during the day, week or week. the month.

Payment sovereignty

Finally, this text is also good news for the EPI project, which seeks to develop a pan-European digital wallet to combat the domination of the American giants in the sector. “Payment data is strategic data, it is necessary to have sovereign systems”, emphasizes Arno Pons. Without access to the NFC antenna, this solution could have difficulty finding its audience, if the project is successful. Many banks, notably Spanish and German, have indeed thrown in the towel.

As it has always done to justify its position, which many consider monopolistic, Apple takes refuge behind the protection of its customers to attack the European text. In a statement, it said it was concerned the new rules would “create unnecessary privacy and security vulnerabilities for our users.” In other words, the American group continues to consider that only applications from its brand are sufficiently secure.

Apple hones its weapons in split payment

After announcing last summer that it was working on its own split payment solution, Apple has just advanced a new pawn. The Cupertino company announced last week the acquisition of the fintech Credit Kudos for an estimated amount of 150 million dollars. This British company specializes in credit scoring based on open banking. In other words, it allows its customers to check the creditworthiness of consumers by connecting to their banking data with their consent. This is one of the main challenges of split payment, accused of encouraging over-indebtedness of individuals. Credit Kudos had raised £5m in April 2020.

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