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Apple beats Aussie banks in fight over Apple Pay access

The banks tried to take on big Apple for a slice of the Apple Pay pie... but their hopes may have crumbled.

ANZ is the only Australian bank that partnered with Apple to provide Apple Pay to its customers, and the only big bank not involved in the ACCC action.

When it comes to taking on Apple, turns out Australia's competition watchdog isn't happy about Australia's big banks banding together to boycott the tech giant over Apple Pay.

The ACCC has issued a "draft determination" denying three of Australia's "big four" banks the power to collectively bargain with Apple over its mobile payments app.

While the ACCC will still seek feedback before making its final ruling, its early comments are telling: it says bank bargaining would limit competition and could lead the banks to unite in blocking Apple Pay for their customers for up to three years.

Confused? Read our full explainer of the issue, and why it matters for Apple Pay in Australia, right here.

Here are the basics: Commonwealth Bank, NAB and Westpac, as well as the smaller Bendigo and Adelaide Banks, want access to the NFC capabilities inside the iPhone so they can launch their own apps with contactless payments.

Apple also charges banks fees to use its digital wallet, but the banks wanted to be able to pass these fees on to their customers -- something that Apple currently restricts.

The banks argued that with collective bargaining power, they'd be able to better negotiate a joint outcome for their customers.

But the ACCC didn't buy it.

"Banks can already offer competing digital wallets on iPhones without direct access to NFC, through their own apps using Apple Pay payment technology, or using NFC tags. Banks can also offer digital wallets on the Android platform," said ACCC Chairman Mr Sims.

By working together, the ACCC argued that the banks could "reduce or distort competition" in the iPhone mobile payment space. The proposed deal would also allow the banks to agree to not sign up to Apple Pay for three years, which the ACCC said would be a massive detriment to customers.

The banks said they would work with the ACCC, but that if the draft determination stands, "effectively there will be no competition against Apple for mobile payments on the iPhone."

"The application has never been about preventing Apple Pay from coming to Australia or reducing competition between wallets," said finance consultant spokesperson for the four banks, Lance Blockley. "It has always been about providing consumer choice and innovation."