Apple negotiates 15 cents per $100 spent on Apple Pay transactions

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Date: Monday, September 15th, 2014, 11:54
Category: News, retail


Apple’s apparently got some admirable leverage where its transaction negotiations are concerned.

Per the mighty Financial Times, Apple will be garnering 15 cents on every US$100 purchase, more than Google managed for its Google Wallet initiative.

Sources familiar with Apple’s banking and credit card arrangements have stated that Apple will get a 0.15 percent cut of every Apple Pay transaction conducted over its NFC-based Apple Pay system.

The new information adds to a previous report that noted Apple will collect fees from banks for customer purchases. What those fees were, exactly, was unknown at the time.

In an in-depth overview of Apple Pay published yesterday, it was reported that Apple’s banking and credit card network partners are willing to offer lower per-transaction fees thanks in large part to the technology’s integration. For example, despite being a “no card present” touch-less solution, Apple Pay will be charged at rates below even “card present” tiers, a major discount competing wireless payment makers were unable to secure.

One element of this is that the ApplePay system doesn’t require a drastically different change on the part of traditional credit card payment networks, as has been seen in some programs backed by major retailers. Instead, banks may be looking to make up the difference through sheer volume driven by Apple Pay’s ready adoption.

Further, Apple’s payments solution is tokenized, meaning card numbers and other sensitive information is replaced with generated codes. The system is thought to be more secure than swip-to-pay methods.

Apple Pay will be available on iPhone 6 and iPhone 6 Plus handsets, as well as the upcoming Apple Watch.

Stay tuned for additional details as they become available.

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