Annual fees can reach $4 billion, Apple Pay is accused of monopoly

Apple faced an antitrust lawsuit over its payment service Apple Pay. The plaintiffs allege that Apple used its market power in the mobile device industry to fend off competition from rival payment apps and charge card issuers to boost profits.

Affinity Credit Union, a payment card credit union in Iowa, filed the lawsuit and seeks to characterize the case as a class action. The credit union accused Apple of violating the Sherman Act designed to protect competition by bundling its mobile devices and mobile wallets to exclude all competitors.

Apple charges issuers 0.15% on credit card transactions and 0.05% on debit card transactions. In contrast, Google Pay and Samsung Pay on the Android platform do not charge card issuers any fees. Apple Pay fees “allegedly generated $1 billion in revenue for Apple in 2019 and are expected to quadruple that ($4 billion) by 2023, ” Affinity said in the lawsuit.

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