Apple has faced a lawsuit in the US regarding Apple Pay.
The tech giant is accused of using its market power in the mobile phone industry to stifle competition from other payment card issuers. The class-action complaint was filed in a federal court in California by Affinity Credit Union, an Iowa-based chartered credit union.
According to the complaint, Apple “coercive” consumers who use their smartphones, smartwatches, and tablets to use their Wallet for contactless payments, unlike makers of Android-based devices that allow consumers to use Google Pay and Samsung Pay like let’s choose wallet.
The complaint alleges that Apple prevents consumers from using a competing mobile wallet capable of offering a competitive Tap & Pay solution.
Affinity Credit Union of Iowa said Apple’s anti-competitive conduct forced more than 4,000 banks and credit unions that use Apple Pay to pay at least $1 billion in additional fees annually for the privilege.
It also said that Apple’s conduct reduced the incentive for the California-based company to make Apple Pay better and more resistant to security breaches.
“Apple’s conduct harms both issuers and consumers and competition as a whole,” Affinity Credit Union said.
“If Apple faced competition, it could not sustain these substantial fees.”
The lawsuit seeks unspecified damages and a halt to Apple‘s alleged anti-competitive conduct.