Apple Pay’s monopoly is under pressure as a proposed class-action lawsuit was filed against Apple for antitrust violations.

Affinity Credit Union is claiming that Apple is wrongfully using its power and charging credit card issuers to use its platform for contactless payments. Apple Pay’s policy includes a payment of 0.15% for credit and 0.05% for debit cards per transaction. As Apple does not allow any other third-party app to use iPhone’s NFC system for tap-to-pay functionality, it has essentially created a monopoly for mobile contactless payments.

Applications, such as PayPal and Square, as well as financial institutions like Chase, Citi and American Express, cannot implement features to their app or function as a mobile wallet for contactless payments. The issue lies in the fact that the same applications function perfectly well on Android phones. Moreover, alternatives such as Google Pay and Samsung Pay offer no charge to credit card issuers.

By excluding competition, Apple can charge “payment card issuers fees that no other mobile wallet ventures can impose,” Affinity Credit Union said in the lawsuit, filed Monday 18th in federal court in San Jose, California.

Affinity Credit Union added that Apple is reportedly generating 1 billion dollars in revenue using Apple Pay in 2019, which was projected to quadruple by 2023.

“When you compare the functionality of Apple Pay to mobile wallets available on Android devices – Google Pay, Samsung Pay – you’re essentially holding up a mirror; they are essentially identical,” said Steve Berman, Hagens Berman co-founder and managing partner, “And yet, the same service on Android that card issuers pay absolutely nothing for costs them a collective $1 billion annually through Apple Pay.”

EU has also expressed concern about Apple’s Apple Pay, back at the beginning of May. The EU had filed a “Statement of Objections” with the preliminary view that Apple has abused its dominant position in mobile wallets on iOS. According to the EU, Apple’s exclusionary behaviour “leads to less innovation and less choice for consumers for mobile wallets on iPhones.”

The law firm handling the lawsuit on behalf of Affinity Credit Union, Hagens Berman, has a history of winning cases against Apple. Hagens Berman has famously reached a $400 million settlement over eBooks price-fixing back in 2016, a $100 million deal in 2021 for small App Store developers, and a $95 million settlement this year over product warranties.

The suit is Affinity Credit Union v. Apple Inc.,3:22-cv-04174, in the Northern District of California (San Jose).