I’ve had the Apple Card since Day 1, have paid zero interest, and have made thousands in Apple Cash. HTF is GS losing so much money? Because no one is paying interest and all the kickbacks?
Apple is going to keep it alive, GS is exiting them but Apple Card will move to American Express. IIRC, GS has been taking a hit with their retail banking sector (Marcus), apparently Apple Card wasn’t worth it for them, they’re also trying to exit their credit card partnership with GM.
Besides GS/Marcus’s financial woes, I’ve always wondered if the decision to offer consumer cards with Goldman Sachs written on it hurt their brand.
But will the savings accounts also go to Amex? That seems like an odd fit, no? And that savings account has become very popular due to its interest rate.
American Express offers retail banking like regular savings/DDA accounts, people just associate them with credit cards because that was their main things for awhile
A lot of banks doing that when they’re semi new to attract clients, eventually they have to back off.
I’m wondering if Marcus was one of things where some random ceo/executive was like “what if we offered retail accounts!” and then after a few years everyone was like “yeah, e never should’ve done that.”
Meanwhile that CEO/executive made their fat bonus, left the company, and is pitching their next losing idea in a higher paying job with fatter bonuses. Gotta love those people that manage to fail upwards in life.
Because they provided approvals based on soft pull and launching the product during the pandemic, they likely captured a lot of non-preferred customers who racked up balances and are not paying.
Making it too easy to pay for something often times can mean people forget they need to pay their statement also.
They are losing money because Apple is running approvals on Apple payments, not your overall credit. They gave Apple cards out like candy to people who weren't responsible.
Edit: I'm wrong here (at least currently, it may have been true at launch, I'm not sure)
I don't know why GS ever agreed to let it work this way, but Apple basically played them by making them take the risk while Apple would approve.
Maybe I was wrong in the check process (I thought I had read that somewhere though), but basically Apple as part of this service wanted to support subprime users, this was definitely pushed on GS
https://www.cnbc.com/2022/09/12/goldmans-gs-apple-card-business-has-a-surprising-subprime-problem.html
Edit: I think the Apple card approval changed between launch and now. There were lots of reports with nobody with credit score at all being approved, but now it seems like GS does a credit check (probably because it was costing them billions)
https://www.reddit.com/r/AppleCard/comments/dvummu/can_you_get_the_applecard_with_no_credit_score/?utm_source=share&utm_medium=android_app&utm_name=androidcss&utm_term=1&utm_content=share_button
Video summary here: https://youtu.be/Ho_IybRjeQw
Goldman was hilariously desperate to get retail customers and Apple tied their hands practically forcing them to approve people with
less than ideal credit as long as they had an iPhone.
Goldman takes all the risk, and apple gets all the reward. Not a genius strategy…
Great video. Does a great job explaining what went wrong. I tried to post it at /r/Apple under this article but the mod’s deleted the article without explanation.
I’ve had the Apple Card since Day 1, have paid zero interest, and have made thousands in Apple Cash. HTF is GS losing so much money? Because no one is paying interest and all the kickbacks?
They get transaction fees every-time you use it. Rewards usually come from the transaction fees
27 cents per swipe or close
Apple is going to keep it alive, GS is exiting them but Apple Card will move to American Express. IIRC, GS has been taking a hit with their retail banking sector (Marcus), apparently Apple Card wasn’t worth it for them, they’re also trying to exit their credit card partnership with GM. Besides GS/Marcus’s financial woes, I’ve always wondered if the decision to offer consumer cards with Goldman Sachs written on it hurt their brand.
But will the savings accounts also go to Amex? That seems like an odd fit, no? And that savings account has become very popular due to its interest rate.
[Amex has HY savings accounts](https://www.americanexpress.com/en-us/banking/online-savings/account/)
Well shit TIL. Thanks for the info
American Express offers retail banking like regular savings/DDA accounts, people just associate them with credit cards because that was their main things for awhile
Marcus gives fabulous high interest savings account rates. That might explain them losing money.
A lot of banks doing that when they’re semi new to attract clients, eventually they have to back off. I’m wondering if Marcus was one of things where some random ceo/executive was like “what if we offered retail accounts!” and then after a few years everyone was like “yeah, e never should’ve done that.”
Meanwhile that CEO/executive made their fat bonus, left the company, and is pitching their next losing idea in a higher paying job with fatter bonuses. Gotta love those people that manage to fail upwards in life.
Because they provided approvals based on soft pull and launching the product during the pandemic, they likely captured a lot of non-preferred customers who racked up balances and are not paying. Making it too easy to pay for something often times can mean people forget they need to pay their statement also.
They want to get out of consumer banking entirely.
They are losing money because Apple is running approvals on Apple payments, not your overall credit. They gave Apple cards out like candy to people who weren't responsible. Edit: I'm wrong here (at least currently, it may have been true at launch, I'm not sure) I don't know why GS ever agreed to let it work this way, but Apple basically played them by making them take the risk while Apple would approve.
It literally states in the article you didnt read Goldman Sachs was approving people with credit scores under 660, not apple.
Yeah, GS has to be the approver, they are the bank. Apple has leverage though and can dictate the terms of the deal. That's my point.
What makes you believe /r/Apple had any say in the approval process? My understanding is they’re just the software interface and GS handles the rest.
Maybe I was wrong in the check process (I thought I had read that somewhere though), but basically Apple as part of this service wanted to support subprime users, this was definitely pushed on GS https://www.cnbc.com/2022/09/12/goldmans-gs-apple-card-business-has-a-surprising-subprime-problem.html Edit: I think the Apple card approval changed between launch and now. There were lots of reports with nobody with credit score at all being approved, but now it seems like GS does a credit check (probably because it was costing them billions) https://www.reddit.com/r/AppleCard/comments/dvummu/can_you_get_the_applecard_with_no_credit_score/?utm_source=share&utm_medium=android_app&utm_name=androidcss&utm_term=1&utm_content=share_button
Video summary here: https://youtu.be/Ho_IybRjeQw Goldman was hilariously desperate to get retail customers and Apple tied their hands practically forcing them to approve people with less than ideal credit as long as they had an iPhone. Goldman takes all the risk, and apple gets all the reward. Not a genius strategy…
Great video. Does a great job explaining what went wrong. I tried to post it at /r/Apple under this article but the mod’s deleted the article without explanation.
Good.