Apple has lashed out at Australia's banks, claiming their attempt to pressure the technology giant to open up NFC technology on its iPhones threatens to compromise the security of devices and reduce innovation.
Late last month three of Australia's big four banks alongside Bendigo Bank lobbied the ACCC to let them form a cartel for the next three years so they can strong-arm Apple into providing third-party access to the near-field communications (NFC) chips on its devices.
The banks said they are currently able to offer Android-based mobile payments services, but are locked out from doing the same thing on iOS. They claim Apple is using its "significant bargaining power" to limit customer choice and competition in the market by only offering its own Apple Pay payments platform on its devices.
But in its response to the call, Apple last week told the ACCC that approving the banks' request would set a "troubling precedent and delay the introduction of new, potentially disruptive technologies".
It also claimed allowing third-party access to the NFC chip would compromise the security of the device.
"Apple upholds very high security standards for our customers when they use Apple devices to make payments," it wrote.
"Providing simple access to the NFC antenna by banking applications would fundamentally diminish the high level of security Apple aims to have on our devices."
Apple argued Apple Pay was not a competitive threat to the banks, who the tech giant accused of wanting to "maintain complete control of their customers".
"The applicants represent the majority of cards issues to consumers and they collectively have the power to dictate the future of mobile payments," it wrote.
"The request ... would slow innovation and reduce choices by protecting members of the cartel from each other for the next three years.
"The banks would have little incentive to compete amongst themselves to develop the best and most innovative payments services for their customers."
Apple claimed it needed the big four banks to be on board with Apple Pay - given their market share - for the payments platform to succeed locally.
It said it had "struggled" to negotiate with Australia's banks - excluding ANZ Bank, which signed up to Apple Pay in April - claiming one had even refused to sign a confidentiality agreement for preliminary discussions.
It urged the ACCC to reject the request so as to avoid harming consumers and competition.
The ACCC is taking submissions on the proposal until August 18.