UK Targets Apple Pay: New Rules to Force Open iPhone Tap-to-Pay

Why the UK regulator is targeting Apple Pay

The UK Competition and Markets Authority found that Apple's prohibitive access fees and technical limits effectively prevent any third-party payment services from launching on the iPhone.

Every time an iPhone owner in the UK taps to buy a coffee or board the tube, Apple controls the transaction. The Competition and Markets Authority (CMA) wants that to change. In a formal proposal, the antitrust watchdog argued that Apple's fee structure and technical restrictions throttle local financial technology startups, ensuring that zero viable competitors to Apple Pay exist in Britain.

The CMA noted that while European Union regulations successfully forced Apple to open up iPhone tap-to-pay hardware, the UK market remains entirely bound to Cupertino's terms. As a result, banks and fintech developers face steep commercial barriers that make offering an independent payment wallet commercially unviable.

The clash over Secure Element and host card emulation

The core technical dispute centers on how an iPhone authorizes a contactless payment. Back in 2024, Apple opened a pathway for British developers to build tap-to-pay apps, but with a major catch: developers were required to use Apple's proprietary Secure Element chip, which handles the encryption of payment credentials alongside steep platform fees.

Across the English Channel, European Union regulations forced broader concessions by requiring Apple to let rival payment apps use host card emulation (HCE) free of charge instead of relying exclusively on hardware chips. The CMA is now demanding an identical approach for the UK, explicitly stating that granting developers access to HCE poses no inherent security risks for users. The move comes as antitrust scrutiny mounts globally across Apple's hardware lineup, from its payments ecosystem to legal battles like Apple's $250M AI iPhone settlement.

Availability and what it means for you

For iPhone users in the UK, these proposed rules mean your banking apps or preferred digital wallets could soon handle tap-to-pay transactions directly without Apple Pay acting as the middleman. If adopted, you could set an alternative default payment app when double-clicking the side button.

In the European Union, third-party NFC wallet access is already operational under regulatory mandates. In the United States, however, Apple retains full control over the NFC chip for general consumer payments, meaning US users will continue to rely exclusively on Apple Pay for the foreseeable future.

The CMA's move signals that Britain has no intention of falling behind the EU when it comes to reigning in mobile ecosystem gatekeepers. If these proposed rules turn into enforceable policy, Apple's lucrative stranglehold on mobile wallets will face its most significant European challenge yet.