Let’s take a look at the market and history of Apple Pay in Europe. Broadly, there are three different categories of issuers:
- Banks that operate locally in EU-countries
- Banks that operate in many or all EEA-counties
- And a rogue example: Boon
Let’s pick Barclays as an Example. Barclays offers current accounts in the UK. If a Romanian resident is able to open a UK Barclays account, his card can be added to his iPhone for Apple Pay (when he changes the phone region temporarily to any country where Apple Pay is available.)
Important here is that the Bank itself decides if it wants to offer the account to the Romanian resident. Barclays has no market presence in Romania. But they can of course sell their products in the single market. Another example is KBC. KBC allowed it for German residents to open an account in Ireland. This way, German customer were able to use Apple Pay before it officially launched in Germany. But: please note that KBC does not „operate“ in Germany. They „just“ sell their banking services via the single market there.
For banks that fall into this category, it’s true that Apple Pay only relies on the country of issuance, the “home country” of the bank. If it’s a UK bank (or any other country where Apple Pay is availabe), the card will work independently from a customer’s legal residency.
Now Banks that do operate in many EU countries. Like N26 or Revolut. Their banking apps are available in many localized app stores. N26 is a German bank. French customers get cards that are issued in Germany. They get a German IBAN as account number. When Apple Pay became available in France, French customers were able to add their cards while German customers weren’t. Apple probably made sure that N26 had the technical means to control this.
There was a case where a German customer tried to fool them: he changed his registered address to a French address. He then was able to use Apple Pay. When N26 found out that the French address wasn’t his residency, they cancelled his account due to a T&Cs violation. He made false statements about his residency.
For banks that fall into this category, it seems that Apple does demand restrictions. Users like to find ways around it, but the example Bunq also shows that the banks feel pressure to make sure that Apple Pay is only available to customers with residency in a country where Apple Pay is available. See N26, Bunq, and most likely Revolut.
Boon is a weird one. Boon technically falls into category 2. Boon is a brand of a German bank (Wirecard) that also has banking licenses in other countries (like the UK). When Apple Pay became availabe in Ireland and France, there was a well documented workaround how customers from other countries could use Boon in their country despite Apple Pay being not available in their country of residence.
I believe Wirecard was clever here: they “outsourced” the country verification to Apple! When a German customer wanted to use Apple Pay with a French Boon account, he had to set up a French Apple ID. The boon app was not available in the German App Store at that time! But with a French Apple ID in the French store, the app was availabe for download. It wasn’t Wirecard’s responsibility anymore to do the ID check, it was Apple’s own responsibility. And the irony is that Apple does not verify Apple ID addresses as long as there’s no payment method added. And the Boon app is free. So Wirecard basically “fooled” Apple here. Technically, using a wrong address with Apple ID is probably a violation of Apple’s T&Cs, but that does not affect Wirecard. German customers were able to open French accounts with their German passports and addresses and they could use Apple Pay that way.
I assume that Apple wasn’t very happy about this. But also didn’t care enough (Boon is not that relevant) to do anything about it. But Apple did make sure that whenever a new partner bank onboarded after Boon that this was prevented.
Conclusion: Apple wants tight control over Apple Pay availability. And there is not one single mechanism taking care of this but individual agreements and technical implementations. It’s based on where and how and to what extend a partner bank operates.
Disclaimer: I am using “where Apple Pay is available” with the same meaning Apple is when it defines “countries and regions that support Apple Pay” (https://support.apple.com/en-gb/HT207957).