Australia Plans to Regulate Digital Payment Services Like Apple Pay and Google Pay

November 28, 2023

Australia’s government has announced plans to regulate digital payment services, including Apple Pay, Google Pay, and other digital wallets. The move aims to bring these services under the same regulatory framework as credit cards and other traditional payment methods. This legislative initiative is set to be introduced to parliament later this week.

Expanding Regulatory Oversight

Digital wallets offered by major players like Apple, Google, and Tencent (developer of WeChat) have gained immense popularity in Australia. However, these digital payment methods currently operate outside the scope of existing Australian payments law. The upcoming legislation, which was initially proposed last month, will expand the regulatory authority of the Reserve Bank of Australia to include oversight of new and emerging payment technologies.

Addressing the Rise in Digital Wallet Usage

Regulators are responding to the rapid growth of digital wallets, particularly among the younger demographic. In the June quarter, transactions from digital wallets accounted for 35% of all card transactions, a significant increase from 10% in early 2020. Notably, two-thirds of Australians aged between 18 and 29 now use mobile payments, a stark contrast to the pre-pandemic figure of less than 20%.

Special Oversight for National Significance

In addition to bringing digital payment services under regulatory oversight, the proposed amendments will grant relevant ministers the power to subject a system or platform to special oversight if it poses a risk of “national significance.” This provision underscores the government’s commitment to ensuring the security and stability of the digital payment landscape in Australia.

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