Apple Pay Most Likely To Be Regulated Like a Bank

The U.S. Consumer Financial Protection Bureau (CFPB) has announced a new rule that will bring major digital payment providers, including Apple Pay, under bank-like supervision.

This rule kicks in 30 days after it’s published in the Federal Register and will apply to digital payment platforms handling more than 50 million transactions a year in U.S. dollars.

Under the new rule, the CFPB will have the authority to conduct aggressive examinations of these services, similar to its oversight of traditional banks and credit unions. The bureau will work on making sure federal financial laws are followed, especially in

• privacy,
• fraud prevention, and
• account stability.

CFPB Director Rohit Chopra stated

“Digital payments have gone from novelty to necessity and our oversight must reflect this reality.”

The rule is made to level the playing field between traditional banks and tech companies providing financial services.

Although Apple Pay isn’t mentioned by name, it’s covered by this rule since it’s one of the most popular digital wallets in the U.S. Other services likely impacted include Google Wallet, PayPal, and Cash App.

The CFPB estimates that the popular apps covered by this rule collectively handle more than 13 billion transactions annually.

More here.