toggle

AAPL Stock: 114.64 ( -3.8 )

Printed from http://www.macnn.com

Apple, financial firms negotiate lower fees for mobile payments

updated 04:45 pm EDT, Thu September 4, 2014

Company allegedly assuming some fraud risk

In preparation for its mobile payment technology, Apple has successfully negotiated deals with five major financial institutions -- American Express, JP Morgan Chase, Citigroup, Capital One, and Bank of America -- to lower transaction fees, sources say. One linchpin was convincing them that mobile payments constitute "card present" transactions, which have a lower discount rate than their opposite, owing to lower fraud risk. That card-present rate has been dropped another 15 to 25 basis points however, meaning that Apple should get a roughly 10 percent discount on processing rates.

Apple is reported to have been "adamant" about getting card-present rates, to the extent of saying it would assume some of the fraud risk by way of Touch ID fingerprint recognition and location data shared via NFC. Banks, in turn, are believed to have conceded on the discount in order to shift that liability, and to make sure Apple's platform accepts all cards.

Reports from August suggested that people will be able to use an iPhone in place of credit cards from American Express, Visa, and Mastercard. The technology should premiere at Apple's press event on September 9.




by MacNN Staff

toggle

Comments

Login Here

Not a member of the MacNN forums? Register now for free.

toggle

Network Headlines

Follow us on Facebook

toggle

Most Popular

Advertisement

Recent Reviews

HP 14-x030nr 14-inch Chromebook

If you're like us, chances are you've come to realize that you need the ability to access the Internet on the go. Also, you've prob ...

15-inch MacBook Pro with Force Touch

Apple's 15-inch Retina MacBook Pro continues to be a popular notebook with professional users and prosumers looking for the ultimate ...

Typo keyboard for iPad

Following numerous legal shenanigans between Typo -- a company founded in part by Ryan Seacrest -- and the clear object of his physica ...

toggle

Most Commented