The popularity of Apple Pay will now see the Cupertino company regulated by the US Consumer Financial Protection Bureau (CFPB), a watchdog whose role is normally limited to banks and financial services companies.The decision means that the bureau will have the power to monitor and regulate Apple’s policies and practices in regard to its mobile wallet services … The Consumer Financial Protection Bureau The CFPB is a US agency responsible for enforcing federal consumer financial law, but also has a broader role as a regulator to ensure that consumer financial products are “fair, transparent, and competitive.” It was always able to ensure that mobile wallet services like Apple Pay and Google Pay complied with the law, but last year proposed that these services be treated much more like banks, giving the CFPB broader powers to enforce fairness and deal with consumer complaints.Apple Pay will be regulated from next month reports that the proposal has been finalized, and will take effect from next month.
The agency’s director says the decision was made because mobile wallet services are now an integral part of people’s financial lives.More than 60% of the US population now uses a mobile wallet, with Apple Pay the most popular choice.9to5Mac’s Take Apple typically doesn’t change its policies to address legislative concerns until it is forced to do so in each of the countries and regions in which it operates, but on this occasion chose to act ahead of time.
The European Union required Apple to open up access to the NFC payment chip to banks and payment card companies, and it was likely that the CFPB would have imposed the same requirement on the company.Instead of limiting the change to the EU, the iPhone maker made the change globally, getting ahead of the game.It’s more than a decade since I first speculated that Apple may end up becoming a bank.
While that hasn’t happened yet, we have seen significant movement in this direction.It already had to obtain banking licenses to launch Apple Pay Later, though it later withdrew the service when it seemed likely to be subject to even more regulation.Today’s CFPB announcement means that whatever labels Apple chooses to use, Apple Pay will now be subject to bank-like regulatory oversight.
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