Commonwealth Bank of Australia (CBA) has broken an impasse by becoming the first major bank in the country since ANZ to adopt Apple Pay, a move that could well shift the rest of the Big Four along the same path.

Until recently, the banks have been reticent to use the payment mechanism provided by tech giant Apple due to worries that it could see them cede control of some of the market in terms of innovation and development. However, with Apple Pay’s growing popularity encouraging a change in stance, CBA has decided to take the plunge.

CBA, which is the largest bank in Australia, officially launched the scheme on Wednesday 23rd January, and now its customers will be able to use their smartphones and devices for contactless payments in stores. This should make it easier to pay for products and services online through a streamlined service that omits entering card details.

ANZ has offered this service for some time, but the three other major lenders, National Australia Bank (NAB), Westpac and CBA were unable to reach a satisfactory agreement with Apple in the past. They hoped that sticking together would strengthen their bargaining power, but the competition watchdog said back in 2017 that a collective boycott was not within the rules.

Another reason why the banks were so against the introduction of Apple Pay was that it would see somebody else taking a slice of the credit card interchange fees levied with each purchase as another enterprise encroached on their traditionally held territory. However, times and technology have moved on quickly in recent years, and demand seems to have become impossible to ignore.


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With fewer customers now relying on cash transactions and the major banks shying away from operating ATMs in the future, it seems pertinent that the payment facilitators are reacting quickly enough to prevent them from losing more market share. The feeling of isolation due to a stubborn refusal to embrace technology is another concern that is emerging for the banks.

Given the prevalence of wearable devices such as Apple Watches and Fitbits, more people are simply not carrying cash or a card around and expect to be able to pay using their smart devices while on the move. This is a much more lasting trend than the banks predicted when they reached a stalemate with Apple back in 2016, which could be what tempted CBA to resume talks with the tech giant.

Interesting, NAB already provides Apple Pay services at its New Zealand operations, so making changes in Australia does not seem as though it will be much of a hardship. In a statement, NAB said: ‘When we have more to say about Apple Pay, we’ll let our customers know.’ The bank added that it is ‘continually’ evaluating digital payment options.

Westpac has also confirmed that it is ‘open’ to the idea, though neither bank appears willing to put a timescale on this.

With plenty of small challenger banks already offering Apple Pay and Android Pay across many destinations, it seems that CBA wanted to avoid missing out on technological innovations by making a point just for the sake of it.