Apple Inc wants to launch Apple Pay in Canada this fall, report says
Apple Inc. is engaged in talks with Canada’s six largest banks about rolling out its Apple Pay mobile payments platform in Canada this fall, the Wall Street Journal reported on Friday.
Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia, Bank of Montreal, Canadian Imperial Bank of Commerce and the National Bank of Canada are said to be a part of the discussions regarding a potential November launch, people familiar with the matter told the newspaper.
Canada would be the first country outside the U.S. to get the service, which enables consumers to pay for goods at retail locations by waving their iPhone or Apple Watch in front of a wireless reader.
The service would be equipped to support mobile payments for both credit and debit cards, people told the Journal.
Several sticking points have emerged in the talks between Apple and the banks, though, over the “onerous” fees Apple wants to charge the banks and the potential security vulnerabilities of the service, the Journal reported.
Apple Pay first launched in the U.S. last October and has reportedly become increasingly popular with consumers there, but indications that U.S. banks are “grappling with growing incidence of fraud on Apple Pay” has caused Canada’s Big Six banks some concern.
“Canadian banks want Apple Pay to work in a way that requires a ‘secondary authentication’ to verify customer information before cards can be used with the phones. That means that a consumer could be required to enter a PIN, log-on to a mobile banking app or use a one-time passcode sent via text message before cards can be used on Apple Pay,” some of the people familiar told the paper.
The Canadian banks are also attempting to secure a better fee structure from Apple, which according to a “base case” one person cited “could be in the range of 15 to 25 basis points on credit card transactions to Apple.”
U.S. banks are charged 15 basis points per credit card payment and half-a-cent per debit transaction for the service, people in the payments industry said.
Source: Financial Post