News & Analysis

Commonwealth Bank officially on board with Apple Pay

- January 23, 2019 2 MIN READ
payments

Commonwealth Bank has officially rolled out Apple Pay for Commonwealth Bank and Bankwest customers with debit and credit cards.

It comes two years after the Australian Competition and Consumer Commission (ACCC) denied authorisation for a group of banks, including Commonwealth Bank, Westpac, and National Australia Bank, to collectively bargain with Apple around its Apple Pay service.

The banks had sought permission to bargain as a group with Apple for access to the Near-Field Communication (NFC) controller in iPhones in order to offer their own digital wallet services to customers, rather than integrate with Apple Pay.

The banks had argued at the time that offering their own digital wallets would lead to increased competition and consumer choice in digital wallets and mobile payments in Australia; increased innovation and investment in digital wallets and other mobile apps using NFC tech; and greater consumer confidence, leading to increased adoption of mobile payment tech in Australia.

As it turns out, adoption of mobile payment tech in Australia has grown anyway: research released by Roy Morgan last June found over six percent of Australians had used the mobile payment solution linked to their smartphone, such as Apple Pay and Android Pay.

This is just below the 7.3 percent of Australians that had used a bank’s mobile payment solution, such as CommBank Tap & Pay, ANZ Mobile Pay, and NAB Pay in the previous 12 months; CommBank Tap & Pay, which allows customers to place a sticker enabling tap-and-go transactions on the back of their phone, was the most popular, used by 4.3 percent of consumers.

Meanwhile, a report on ‘mCommerce’, or mobile commerce, released by PayPal last September found 68 percent of Australian consumers make payments via apps, with 29 percent paying via app at least weekly. Beyond apps, the report also found 72 percent of Australian consumers use mobile devices for payments, with 48 percent doing so at least weekly.

The rollout for Commonwealth Bank and Bankwest customers follows the bank’s announcement of the move in December.

Angus Sullivan, group executive of Retail Banking Services, said in a statement, “In 2019, customers can expect us to continue listening, innovating, and providing the best possible experiences when they bank with us.”

This focus on listening to customers and innovating comes as the neobanks, or digital-only banks, start to make headway.

Volt Bank was yesterday granted a full banking licence from the Australian Prudential Regulation Authority (APRA).

This means it is now licensed to operate as an authorised deposit-taking institution (ADI) without restrictions, making it a fully-fledged bank – or, it will be when it starts releasing products.

Volt Bank CEO Steve Weston said being granted the licence is “a huge responsibility, as we will set the tone for a new era of banking”.

Image: by Jonas Leupe on Unsplash

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