A London-based financial technology firm, Curve, has announced plans to introduce the first alternative to Apple Wallet, setting the stage for increased competition in the digital payments arena.
Curve’s innovative system will enable users to make “tap and go” payments on their phones by downloading the Curve app and setting it as their default payment method. Currently, iPhone users can only use Apple’s proprietary payment system for this function.
This development follows the conclusion of a European Commission investigation that began in 2020, which led to Apple granting rivals free access to its near-field communication (NFC) chip. This chip facilitates mobile device payments, and Apple has also unlocked the necessary permissions and application programming interfaces (APIs) to allow other companies to develop payment solutions.
Although Apple is still finalising the technical details, a Curve spokesman confirmed that their product would be ready for launch once these are resolved. Curve asserts that this change will save banks “millions of euros” currently paid to Apple in transaction fees.
Apple Wallet, exclusive to iPhones and other Apple hardware, stores sensitive information ranging from credit card details to airline tickets. While the introduction of alternative payment providers won’t immediately impact other regions, ongoing regulatory investigations could spur further changes. For instance, the US Department of Justice filed a lawsuit against Apple in March, alleging that the company has monopolised the smartphone market, thereby stifling competition and innovation.
Founded in 2015 by Shachar Bialick, 42, Curve consolidates users’ bank and loyalty cards into one app, boasting over four million customers who spent £3.2 billion via the platform in 2022. Despite cutting over 100 jobs in 2022, Curve aims to achieve profitability this year, generating revenue through card transactions, ATM withdrawals, currency exchanges, and subscription services. The company reported a revenue of £45 million last year, up 320% from the previous year, with a pre-tax loss of £24.2 million, a 57% reduction.
Bialick commented on the market shift: “The newly competitive market for digital wallets is about to experience genuine customer-first innovation.” Other companies, including Vipps MobilePay, are also poised to introduce their own products.
Apple’s traditional business model faces additional challenges beyond digital payments. Regulatory scrutiny has also targeted its music platform, the exclusivity of Apple Watch to its iOS operating system, and its messaging system. The recent passing of Britain’s digital markets bill and new European legislation on digital competition have pressured Apple to open iOS to alternative in-app payment systems and app stores.
Daniel Ek, 41, CEO of Spotify and a long-time critic of Apple’s app store policies, praised the new UK law, stating it has “the potential to unlock real competition and growth and Apple must be held accountable in the UK because we cannot miss the opportunity to get it right.”
Apple maintains that its closed system ensures customer privacy and security, arguing that the mandated changes will lead to “unavoidable increased privacy and security threats.” Nevertheless, the landscape of digital wallets and payment systems is set to evolve rapidly as regulatory bodies and market players push for more competition and innovation.
