Apple is being sued for antitrust issues related to Apple Pay.

Apple "coerces" users of its smartphones, smartwatches, and tablets to use its own wallet for contactless payments, claims a lawsuit filed in federal court in San Francisco.

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Unlike manufacturers of Android-based handsets, who offer customers the option of wallets like Samsung Pay and Google Pay.

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The maker of the iPhone is accused by payment card companies of abusing its position as the market leader in mobile devices to stifle competition for its Apple Pay mobile wallet.

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Iowa's Affinity Credit Union, claimed that Apple's anticompetitive behaviour forces the more than 4,000 banks and credit unions that use Apple Pay to pay at least $1 billion in extra fees.

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It also claimed that Apple's actions reduce the motivation for the Cupertino, California-based company to improve Apple Pay and make it more resistant to security breaches.

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According to the lawsuit, Apple charges issuers a 0.15 percent cost on credit transactions and a flat 0.5 cent fee on debit purchases using Apple Pay, whereas Android-based competitors charge nothing.

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