Smaller font sizes on smaller screen devices

I'm an iOS developer and I recently had a discussion with a designer in my team about the font size of a label in an iOS app that we are producing. It is a small label that is used to present the user with their account balance. One issue is that this label was designed with a width in mind that it couldn't fit big amounts of money. The idea of making the font scalable depending on the text size is OK and easy to apply, but we reached another problem:

When using the same app on a smaller device (like an iPhone SE), the text doesn't fit the label even for considerably small amounts of money, so the solution proposed by this designer was to make the initial font size smaller on small devices so it can scale down from there when needed.

But my question is: Presenting smaller fonts to people with smaller devices wouldn't affect readability since the screen itself is already small? My idea was for him to rethink and redesign that area of the app taking into consideration different sizes of screen but he refuses to do so, insisting on the smaller font size to fix it. Are there any articles or "Good Practices" kind of documents that can support either one of these sides?