Apple and other tech giants are raising antitrust concerns with their new financial services

Apple and other tech giants – Amazon, Alphabet (Google) and Meta (Facebook) – have drawn antitrust concerns with their latest advances in financial services. The US Consumer Financial Protection Bureau (CFPB) is looking into Apple’s actions, its UK counterpart the Financial Conduct Authority (FCA) is taking a broader view.

Some of Apple’s financial services like Apple Card are actually operated by existing banks like Goldman Sachs. However, Apple is acting as its own bank for the new “Pay Later” feature and that’s what caught the attention of the CFPB.

Apple introduced Pay Later with iOS 16

Apple Card is currently only available in the US, but there are signs that it could launch in the UK as well. For example, Apple recently acquired Credit Kudos, a UK startup that performs credit report 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 the short-term benefits to consumers could be exploited by companies to crush competition in the long-term market.

Here is what the FCA said in a message released earlier today:

“By combining financial services with their existing businesses, Big Tech companies can bring benefits to consumers. These can be innovative new offerings with highly competitive pricing, driven by increased efficiency, offering healthy competition with incumbent financial service providers.

But in the longer term, Big Tech companies could pose competitive risks if they quickly gain market share and are able to exploit their market power.

The FCA is not taking any action at this time, it just wants to open a discussion with tech companies, consumers and even other regulators and talk about a “pro-competitive approach to digital markets”.

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