South Korean Fintech Firms Petition Against Apple’s NFC Barricade

Journalist:
September 27, 2016

Several South Korean fintech companies plan to petition the Korean Fair Trade Commission (KFTC) to object to Apple’s policy of not opening its near field communication (NFC) to outside app developers, according to Pulse, an English-language news site of Maeil Business Newspaper in South Korea. The Korean firms claim Apple’s policy prevents them from offering certain fintech services to customers.

Interpay Co., eB Card Co., Hankook NFC Co., Kona I Co. and KTB Solution plan to file the petition as early as this month. The Korea Fintech Industry Association (KORFIN) is leading the effort, arguing that Apple’s policy to restrict the NFC capability to Apple Pay could violate consumer protection laws.

Consumer Rights At Issue

Lee Seung-gun, KORFIN chairman, said the firms have spoken to consumer advocacy groups to address technical constraints in bringing the petition under the association’s name. He said consumers should not be deprived of opportunities to have various fintech services due to Apple’s policy.

The NFC function exclusively used for Apple Pay has been installed in its iPhone 6 models. Apple’s lock on its programming interface denies Korean customers access to NFC services like identification of credit card users, mobile transport cards and mobile payment.

Samsung Electronics Co., by contrast, opened its NFC capability to external apps, enabling many apps besides Samsung Pay.

Also read: Apple battles Australian banks over access to Apple Pay platform

NFC Apps Restricted

eB Card has created an NFC-based mobile transport card, but Apple’s policy forced eB Card to only offer the service to Android phone users.

Kona I Co. also created a mobile pay app that utilizes NFC, but it does not work on iPhones.

Hwan Seung-ik, Hankook NFC XEO, said consumers have the right to enjoy NFC-based services, but those in Korea cannot use them even though they bought the same type of iPhones as U.S. consumers, which he said is “nonsense.”

A similar situation has occurred in Australia, where five banks applied to the Australian Competition and Consumer Commission (ACCC) seeking approval for collective bargaining in negotiating with Apple to gain access to its mobile payment technology, CCN reported nearly a month ago. The Australian banks were seeking to negotiate collectively with Apple to gain direct access to its NFC radio in addition to other requests.

Image from iStock/junce.

Last modified (UTC): September 27, 2016 21:47

Tags: apple
Lester Coleman

Lester Coleman is a media relations consultant for the payments and automated retailing industries.