Recently, Apple Pay and ANZ teamed up and inked a deal through which ANZ became the first major bank to offer Apple Pay. Within two months of finalising the deal, ANZ highlighted benefits including more customers opening accounts and commencing of the use of credit cards, which were otherwise dormant. Australian consumers have generally been averse to using digital wallets but ANZ reports that the step boosted the sales of transaction accounts, especially in digital segment.
As part of capitalising on the strong partnership, the bank is introducing a new credit card for travellers, which will include in its annual fee of $ 225 a domestic return flight every year. This comes along the Apple Pay deal such that bank clients can leverage their iPhone or Apple Watch for purchases.
Given the above deal, ANZ reported over 60% annual growth in digital sales of transaction accounts during the month of May 2016. The deal is thus said to substantially impact the growth in the retail deposit business. In May 2016, growth was up 20% year-on-year, but digital channel sales are up more than 60%. CEO Shayne Elliott, who took his position in February 2016, has promised a greater focus on technology, as well as growth in the retail banking sector,
while reducing the emphasis on Asia and ANZ expects to grow its customer numbers by 200,000 during the course of this year. Though some banks are not very happy at sharing revenues with Apple, ANZ uses as a means of speeding up customer growth and becoming far more engaged in the financial affairs of its customers.
One of the crucial elements of the competition between banks for the acquisition of new credit card customers in the recent past has been the use of 0% balance transfers, but ANZ has now said that it will not focus on balance transfers; and citing the situation in the
UK market where banks can offer interest-free periods in excess of 40 months, ANZ has removed balance transfer deals for two of its credit cards with effect from this month.
ANZ hoped that the deal would encourage the many devoted fans of the technology company to open deposit accounts and enable it to leapfrog its rivals. The deal was concluded after ANZ agreed to surrender some of its interchange revenue to Apple, which in turn offered to compromise by reducing the fees it was demanding from US banks.
Details have not been made public because of the confidentiality agreements demanded from ANZ by Apple. However, the other banks are discussing similar deals to catch up with ANZ and these could be a few months away.
Disclaimer
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376).The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd currently hold positions in: BHP, BKY, KCN, PDN, and RIO. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.