Contracts are preventing some retailers from accepting Apple Pay

The spat between Apple Pay and a prototype rival system, CurrentC, is already relatively well documented. But according to a New York Times report, things go a little deeper: any merchant that’s signed up to use CurrentC is legally forbidden from accepting Apple Pay. The Times quotes numerous anonymous sources as saying that retailers who are part of the Merchant Customer Exchange, a group made up of merchants including the likes of Best Buy and Walmart, have exclusivity clauses in their contracts, meaning that accepting competing mobile payment options would result in steep fines.

One week after its debut, Apple’s new mobile wallet is showing promise with consumers. Apple’s rivals in the payments industry, meanwhile, are scrambling to prevent it from being too successful. Even before Apple Pay was announced, a coalition of retailers refused to accept it in their stores. More than 50 companies make up this group, the so-called Merchant Customer Exchange or MCX, including global retail giants like Walmart, Best Buy and Gap Inc. It’s not that these companies don’t want a mobile wallet to truly catch on with consumers. They see the mobile wallet as a way to help retailers understand more about their customers’ shopping habits and, potentially, let merchants avoid the high fees they pay when processing credit card transactions. But they are working on building a competitor, CurrentC, a mobile wallet app that will connect directly to customers’ bank accounts or store-specific credit card. It won’t be available until 2015.