Chinese site Caixin reports that Apple has agreed to take much smaller fees from banks in China compared to the US as the company this month launches its Apple Pay payments service in the country.
The deal with Chinese banks will see Apple get around 0.07 percent per transaction, according to the report citing unnamed sources, compared to approximately 0.15 percent itâ€™s charging banks in the US.
Apple Inc. will earn fees from Chinese banks when customers use its mobile payment service for purchases, but they will be about half of what the U.S. tech giant charges in the United States, people with knowledge of the matter say… Apple will start collecting the fees in two years. Apple started negotiating with major Chinese banks and UnionPay over profit-sharing and technical issues in 2014. The talks stalled, apparently because Chinese banks argued the charges were too steep.
Caixin adds that sources say new banks signing on with Apple in to support Apple Pay in the country might not get the same lower fee and that the agreement with the initial launch group of banks was â€śa result of compromise from both sidesâ€ť in an effort to get the service launched.
“These 19 banks will pay Apple the fees at a discount, but banks that get on board later may not have the leverage anymore,” a person with the knowledge of the mater said.
The report follows an official launch of Apple Pay in China last with card issuer China UnionPay and around 19 banks. The launch saw a rush of around 10 million users signing up in the first hour, according to local reports, and close to 40 million on day one. Apple is going up against Chinese market leader Alipay, reported to have approximately 400M users.Â
The launch of Apple Pay in China adds it to theÂ list of supported Apple Pay countries alongside the US, the UK, Canada, and Australia.
Filed under: iOS Devices Tagged: 0.07 percent, 0.15, Apple pay, banks, china, credit cards, Fees, Tim Cook, UnionPay, US
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