Apple and other tech giants — Amazon, Alphabet (Google) and Meta (Facebook) — have attracted antitrust concerns for their recent moves into financial services. The US Consumer Financial Protection Bureau (CFPB) is looking into Apple’s actions, while its UK counterpart, the Financial Conduct Authority (FCA), is taking a broader view.
Some of Apple’s financial services, such as Apple Card, are managed by existing banks such as Goldman Sachs. However, Apple is acting like its own bank for the new “pay later” feature and this is what has caught the attention of the CFPB.
Apple Pay was later introduced in iOS 16
Apple Card is only available in the US, but there are signs that it may launch in the UK as well. For example, Apple recently acquired UK startup Credit Kudos, which does credit rating checks.
Other tech giants are also rolling out new financial services. For example, last week Amazon launched an online insurance store in the UK. The FCA’s concern is that short-term benefits for consumers can be used by companies to undermine competition in the market in the long-term.
Here’s what the FCA said in a post earlier today:
“By integrating financial services into their existing business, Big Tech firms can bring benefits to consumers. These can be new offerings driven by increased efficiency, healthy competition with existing financial service providers, and highly competitive pricing.”
But in the long run, if Big Tech companies quickly gain market share and exploit market power, they may pose competitive risks.
The FCA is not taking any action at the moment, it just wants to open a dialogue with tech companies, consumers and other regulators and talk about a “pro-competitive approach to digital markets”.
source | in 1 | On the 2nd side