A federal judge has approved a class-action lawsuit enabling thousands of U.S. banks and credit unions to sue Apple over fees tied to Apple Pay transactions. The decision allows card issuers to pursue claims together, accusing Apple of leveraging its control over contactless payments on iPhones and charging fees on every transaction made through Apple Pay. Key issues like whether Apple monopolized the market, harmed competition, and overcharged issuers remain to be decided in court.
What’s at Stake
The lawsuit, filed in 2022 by several credit unions including Affinity Credit Union, GreenState Credit Union, and Consumers Co-op Credit Union, argues that Apple Pay issuer fees—which are 0.15% for credit card purchases and a flat half-cent per debit transaction—are only possible because rival tap-to-pay wallet solutions are blocked from accessing the iPhone’s NFC (contactless payment) hardware. Without such competition, the credit unions claim Apple has been able to impose what they view as inflated fees and unfair terms. Issuers are now seeking restitution of those fees and reforms to Apple’s practices.
Recent Ruling and Its Ramifications
On September 23, Judge Jeffrey White certified the class, rejecting Apple’s motion to exclude the damages expert, Christopher Vellturo. Vellturo’s methodology centers on comparing Apple’s issuer fees to what competing mobile wallets—those not charging issuers—purportedly collect, estimating the overpayments made by the class. While Apple contested aspects of this expert’s approach, the judge held that such challenges are matters for cross-examination later rather than grounds for exclusion.
The certified class includes all U.S. banks or credit unions that (1) issued an Apple Pay-enabled card and (2) paid Apple a transaction fee for purchases made through that card. Thousands are believed to qualify. Importantly, while the class certification allows collective pursuit of claims, it doesn’t resolve whether Apple violated antitrust law or that the fees are illegal. Nor does it affect Apple’s changes to tap-to-pay rules made in 2024.
Apple’s Tap-to-Pay Policy Shift
An update introduced with iOS 18.1 in 2024 opened the door for third-party apps (subject to Apple’s approval and commercial agreements) to process tap-to-pay transactions using the iPhone’s NFC hardware. Eligible apps can also be set as the default for contactless payments. However, those approvals still require Apple’s commercial terms, and the fees imposed via Apple Pay remain the subject of dispute in this lawsuit. The recent ruling leaves unchanged any claims based on past fees paid or potential liability accruing from practices before the policy shift.
The case also reflects a broader trend of heightened scrutiny over platform owners’ control of app ecosystems and payments. Regulatory bodies and courts globally are increasingly challenging whether companies like Apple can maintain exclusive control over key system features (like NFC) and charge fees as a consequence.
The judge also found that core issues—like Apple’s possible monopoly power, anticompetitive harm, and whether fees caused injury—are common questions that can be resolved on behalf of the entire class. The uniform rate structure for credit and debit transaction fees strengthens that finding, by allowing a shared method for calculating damages if liability is established.
Apple had previously succeeded in dismissing certain claims—specifically, accusations that it unlawfully tied iOS devices to Apple Pay—but the broader monopolization claims were allowed to proceed under earlier rulings.
Why It Matters
This decision could have major financial implications for Apple and reshape how contactless payments work on iPhones. If the issuers prevail, Apple might be forced to refund past fees, significantly altering its revenue model for Apple Pay. It could also push further openness in how third-party apps use key hardware features like NFC.
While Apple has already loosened control somewhat via iOS 18.1’s tap-to-pay revisions, this lawsuit shows that policy tweaks may not be enough to preclude legal liability for past practices. Moving forward, how strictly courts assess platform fee structures and hardware access restrictions could influence hands-on regulation of tech platforms.
For now, the class-action status means thousands of banks will proceed together to hold Apple to account. The next phases—summary judgment, trial—could clarify whether unauthorized practices existed and what remedies might follow. If this lawsuit succeeds, Apple’s approach to payment fees and NFC access could look very different in the future.
