2025-07: "Apple Pay vs. Alternative Payment Services"

by Marc Stibane

Thought experiment

Imagine an airport which issues a frequent traveller card which millions of passengers have signed up for. This Airport demands from the shops in the airport mall to either only offer their traveller card for payments, or any other payment method, but not both. So if merchants offer alternative payment methods to customers, they may not offer the airport traveller card.

This would be ridiculous, right? We expect that every merchant can offer their customers all payment methods they want - some merchants only accept cash, some accept debit but not credit cards, some accept all cards you can think of. An Airport should never demand that shops in their mall wanting to offer the traveller card are not allowed to offer other payment methods. Would the EU allow Visa or Mastercard to impose such exclusion rules on merchants who want to accept their credit cards? Definitely not.

AppStore Rules

But that's exactly what Apple demands from app manufacturers in their mall: App manufacturers must decide whether their apps either offer Apple payments only (in which case millions of users can pay easily with just two clicks) or whether they use an alternative payment service. They are not allowed to offer their users to choose from both Apple payments and alternative payment services.

This means app manufacturers have no real freedom of choice. Since millions of customers already have signed up for Apple payments in their Apple account, app manufacturers cannot really afford to exclude them as potential customers. App manufacturers should be able to freely choose one or multiple payment methods (Apple payments and/or alternative payment providers) to offer their customers. Users would then have the choice for each payment, which of the offered payment methods they want to use now. And of course, zero fees should go to Apple if the choice is an alternative payment service.

Apple itself does not eat their own dogfood

The Apple Store, where Apple sells its own hardware, offers multiple payment methods. Customers in the Apple Store can pay not only with Apple Pay, but also with debit or credit cards, bank transfers, or PayPal. Apple knows it would lose sales if it offered only one payment method.

Here, the gatekeeper Apple offers Apple Pay and other payment methods simultaneously, and lets customers choose how they want to pay for each order. App manufacturers in the AppStore may only offer either-or, but not both. In this situation, alternative payment providers have zero chance to be chosen instead of Apple payments, since few app manufacturers would risk to lose their existing customers.

Fair competition!

Countries should require Apple to let app manufacturers offer all payment methods they want (incl. Apple payments) simultaneously, so the end customer can decide which payment method to choose for each individual payment. We hope EU's Digital Market Act will allow the commission to establish such a rule in Europe.