Apple Pay India launch delayed

The launch of Apple India’s mobile payment service, Apple Pay has been delayed as large banks bargain hard over payment commissions. Apple Pay has been preparing for the launch after the Reserve Bank of India (RBI) updated its additional factor authentication (AFA) guidelines late last year, enabling biometric authorization for card payments.

Apple is asking for 20 basis points (bps) per transaction but the larger banks are willing to share only 15 bps, similar to the iPhone maker’s global commission structure in the US. Apple is apparently asking for a higher share from Indian banks, citing its premium play in India, where Android holds sway with close to 90 percent market share.

 “The negotiations with the credit card issuing banks are stuck on commercials, while the technology and infrastructure are ready to enable the launch the next day,” said one of the partner firms for Apple Pay’s India launch.

Apple is in talks with the largest credit card issuers in the country such as HDFC Bank, SBI Cards, ICICI Bank, Axis Bank and Kotak Mahindra Bank.

Apple wants to launch its payment product with the largest credit card issuing banks, this is the reason for the delay.

A major sticking point for Apple's entry was the RBI's data localisation mandate, which required the company to undergo mandatory annual system audit reports (SAR).

Apple believed that it did not need to undergo SAR, as it does not store the payment data.