Apple Quietly Launches Open Banking Feature In UK

September 29, 2023
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The bigtech company will now allow users to view their bank balances in their Apple Wallet — a move payments insiders have welcomed.

The bigtech company will now allow users to view their bank balances in their Apple Wallet — a move payments insiders have welcomed. 

Apple is reported to have launched a new iPhone wallet app that is integrated into the UK's open banking framework. 

The UK’s open banking standards — steered by the Open Banking Implementation Entity (OBIE) — mean that it has become the first country in the world where users can see their balances on the iPhone wallet. 

Supporting banks in the initial rollout include CMA9 institutions such as Barclays, HSBC, Lloyds and RBS, as well as well-known challengers Monzo and Starling.

Apple, which hasn’t put out a press statement nor responded to Vixio’s request for comment, has made little fanfare over the announcement.

However, it has understandably sparked excitement from open banking players in the UK and further afield.  

"This is a seemingly small but extremely significant advancement for open banking in the UK,” commented Lauren Jones, market development director at Open Banking Exchange. 

"Account aggregation has been around for [more than] five years and there are many fintechs [that] are doing a fantastic job of it, Jones said. “However, the industry has been saying for some time that as large companies start to leverage open banking, that is what will really drive it into the mainstream."

“Account aggregation has been an open banking service from the very beginning, but it is exciting to see it adopted by Apple now,” said one fintech source in London. 

The source explained that this is overdue, considering Apple’s Credit Kudos acquisition in March 2022. 

“Open banking payments are already growing very quickly, doubling year-on-year, and it could be that Apple going live with a data offering helps mainstream open banking,” the source speculated. “Let's see what other open banking features are added on top.”

Gary Prince, chief executive of the Payment Firm Limited, agreed that this should not be considered a surprising move, considering the 2022 acquisition. 

"It's about time. This is a long time coming and they've finally done it," he said.

Prince pointed out that from a consumer perspective, several payment initiation service providers (PISPs) have tried to set up businesses for consumers to use, but since exited the market. 

"A lot, like Yolt, have all fallen. The problem you have is that if you're not a bank and you want to offer aggregation services and move money around, how can this be done when you want to charge for it? Why will consumers pay for it?"

Prince explained that the feature needs real value to be worth paying for. "It was always the tech businesses [that] had a massive advantage. I'm just surprised it has taken this long."

"We should anticipate that Google and maybe Amazon will follow suit," he said. "There has been a lot of talk about super apps. Google and Apple could be these super apps, as the tech companies can afford to do this for nothing."

The wallet app will now be able to show its user's current account balance from their bank under the image of the card. It will also continue to show users a history of their deposits and payments. 

This includes balances for both credit and debit cards, and the balances will also be shown when buying something with Apple Pay.

This integration is rolling out first as part of the upcoming iOS 17.1 developer beta, as reported by the trade publication 9To5Mac. 

It will be available to a subset of wallet app users in the UK who have an Apple Pay credit or debit card associated with a supporting bank.

“It will be interesting to see how the banks respond,” said the source. 

“Do they find ways to keep up by innovating and finding new ways to keep their customers happy? I suspect some will, and those who don't will be left further behind. I'm sure no UK or EU bank is thrilled by the news, but will they draw the right lessons from it?”

Apple has persistently innovated in the payments space, with Apple Pay itself and also Apple Pay Later, a buy now, pay later (BNPL) product that launched in the US in March this year. 

The bigtech company also launched "Tap to Pay" on iPhones in 2022. This feature allows merchants to accept contactless payments from their iPhones and is available in jurisdictions including the US, UK, Netherlands and Brazil. 

“Nearly 52 percent of the UK smartphone market is Apple. That number jumps to 73 percent amongst 18-19 year olds, who we know are far more likely to adopt new products and services,” said Jones. 

“This move will bring open banking services to a far broader segment of the UK population, which is a fantastic outcome for the open banking movement and UK customers at large.”

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