Big tech companies like Apple and Google should face the same regulations as banks if they push deeper into finance products, Germany's deputy finance minister said, according to Bloomberg.
The companies' transition into the highly regulated finance industry would bring new competition to legacy banks. Although privacy remains a priority for tech giants, the companies can't use it as an excuse to avoid government supervision, according to Deputy Finance Minster Joerg Kukies.
"It's really, really important" to make sure tech giants follow the same rules as banks to keep consumers safe, Kukies reportedly said at a Monday conference in Frankfurt. "That means the big tech firms also need to open their interfaces to guarantee fair competition and innovation."
Tech firms are moving further into consumer finance, using new products to boost revenue and collect data on a valuable facet of users' lives. Apple released its credit card with Goldman Sachs on August 20 and has already issued $10 billion in credit. Google is eyeing a 2020 release for the checking account product it developed with Citigroup and Stanford Federal Credit Union.
Both firms have already offered digital payment options for years, but those products tie in to existing bank accounts. The German government is "totally OK" with services like Apple Pay and Google Pay, Kukies said, but a new law passed by the country's parliament last week "created the prerequisites for competition being preserved on these platforms."
A German parliamentary committee voted Wednesday to approve a law forcing tech companies to open payment services like Apple Pay to rival providers. The law is part of anti-money laundering legislation adopted Thursday and scheduled to go into effect in early 2020.
Apple opposed the regulation, saying the opening-up of its payment service could endanger users' financial security and data privacy.
Kukies fired back at the Monday conference, noting that a financial service should face the same scrutiny whether it's offered by a tech giant or a bank.
"The same business, with the same risk, needs an equivalent regulation and supervision. That means we can't just subject banks to know your customer, anti-money laundering and other important regulations, but that these regulations need to be applied fairly and equally to all," Kukies said, according to Bloomberg.
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