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France: The Competition Authority is concerned about the weight of tech giants on payment services

by Mathieu Rosemain

PARIS (Reuters) – Digital payment services developed by US tech giants like Apple and Alphabet subsidiary Google could strengthen their market position by giving them more control over consumer data, the French competition authority.

This warning published in a 127-page document follows a year-long investigation into new payment technologies and highlights the opinion of the competition authority on the proliferation of smartphone banking applications such as that of the British Revolut or the German N26.

The French competition policeman believes that the payment services of Apple, Google and Amazon enjoy significant competitive advantages thanks to the large number of users attracted to their platforms and the data collected.

This data enables them to better assess the financial situation of their users and to adapt their offers, in particular by estimating the maximum price that a customer is willing to pay for a product or a service.

Near Field Communication (NFC) contactless payment technology can also constitute a barrier to entry into this market for potential competitors, depending on the access granted by smartphone manufacturers or operating systems. , notes the competition authority.

The Apple Pay service is only available on devices from the manufacturer to Apple and its NFC chip cannot be exploited by third parties.

The competition authority also notes that the financial power of the tech giants allows them to invest huge sums of money to better integrate payment tools into their systems, thus creating an increased risk of consumer lock-in. in their platforms.

The European Commission launched an investigation into Apple Pay last year.

The regulatory authorities of the European Union are particularly interested in the obligation imposed by Apple on developers to use its integrated payment system on its App Store online application store.

They also fear that Apple Pay, launched in 2014, is the mobile payment service authorized to use the contactless payment function of iPhones.

(French version Claude Chendjou, edited by Blandine Hénault)

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