I don't thing it is healthy to have big entities like this control fundamental services like payment processing. How long before the opaque governance of the App Store is applied to their payments offering? How long before activists start making this a new vector for deplatforming? Apple also announced a news offering (<a href="https://www.techradar.com/news/apple-news-plus" rel="nofollow">https://www.techradar.com/news/apple-news-plus</a>) and I think the same concerns apply there.
For those of you concerned about the "antitrust" aspect here, the specter of Apple controlling everything... Keep in mind that Apple has had a partnership-based branded credit card for <i>years</i>: the Barclaycard Visa with Apple Rewards. There is nothing fundamentally new in Apple offering a credit card.<p>What's new here is they're tightly integrating it with Apple Wallet and in some aspects driving a better deal (like eliminating fees and points and data brokering). Overall I would characterize their offering as a "competitive" rewards card. But what's really distinctive here is the elegant Apple-designed UI around managing your spending and interest charges and rewards, which looks exceptional.<p>The other really clever thing is how they've leveraged the iPhone to improve the security of the backwards-compatible physical card. For non-ApplePay e-commerce they can rotate the CSC/CVV number you look up on your phone (since it's not printed on the card). And they can just reach out to you through iOS with suspicious transaction notifications and strongly re-authenticate you, instead of relying on antiquated robocalls.<p>One question I have is whether the card will have a stripe on it or just a chip. Traditionally merchants would be liable for fraudulent swipes without properly-checked signatures. If the signatureless card supports swipes, presumably Goldman Sachs would need to take on that liability now. Maybe that explains why rewards are 1% on physical card transactions instead of 2%.
I love the app used to manage spending and paying your bill. It'll definitely be super easy to stay on budget given the fact that you'll have immediate access to up-to-date spending and trends, whereas if I want to do that with my Chase account, I need to login, run numbers, etc.<p>There seems to be a subfocus here about helping you manage your spending, which I can appreciate. The problem with ease of spending money is ease of going into debt, I think I could make this work for my wife and I fairly well, and easily at that.<p>Of course, the practicality of this for each person depends on their typical spending patterns and how often they can use Apple Pay in the first place. If you shop at places that don't accept it, you're pretty much out of luck.<p>Interesting foray into a gigantic industry that loves preying on people's inability to be responsible, though. I can think of a lot of people who could use more oversight with their spending.
This is interesting to observe from the UK.<p>- Cashback is generally lower here because interchange fees are regulated/capped to 0.3% for personal credit cards and 0.2% for personal debit cards. Offers of 2% cashback simply won't work outside the US so I'll be curious to see how (if?) they try and expand this globally.<p>- "All of the spending tracking and other information is stored directly on the device, not Apple’s servers" - can't see how this will work in practice. If you lose your phone, do you lose information on historical purchases? What if you want them for your records? Perhaps "spending tracking" just refers to data derived from the transaction information... but then, couldn't you just recompute it?<p>- "Apple also says that it’ll use machine learning and Apple Maps to label stores that you use in the app, and use that data to track purchases across categories like “food and drink” or “shopping.” " - I guess this is novel in the United States, but challenger banks like Monzo/Starling have been doing this for a number of years.<p>- "Customers will also be able to track purchases, check balances, and see when their bill is due right from the app." - not novel, CC providers like Amex and banks like Monzo already do all of this, including push notifications.<p>- "To get an Apple Card, users will be able to sign up on their iPhone in the Apple Wallet app and get a digital card that they can use anywhere Apple Pay is accepted “within minutes.”" - again, not novel. If you sign up for a Monzo account, the KYC checks are done reasonably quickly (certainly same-day IME) and then your account is open. You can add it to Android Pay (<a href="https://monzo.com/blog/2018/11/19/instant-google-pay/" rel="nofollow">https://monzo.com/blog/2018/11/19/instant-google-pay/</a>) and make payments, bank transfer money in instantly etc.<p>Overall, I'm a little perplexed as to why this offering is interesting besides Apple having announced it.
It seems to me that Apple can offer reduced fees due to the fact that they'll have less fraud as a result of requiring touch/face ID for every purchase.<p>While interesting, it doesn't come close to solving what I feel is the largest problem with cards in the US today -- interchange fees.
One of the reasons for having a Credit Card for me is the protection from shady merchants, fraudulent transactions and the assurance of getting my money back if there is a major issue with product/service.<p>AMEX once refunded me $1800 for speakers that were damaged in shipping with some documentation, photos and details about the issue.<p>Now, customer service varies from bank to bank but AMEX has always had the best customer service in my view, bar none. I wonder how Apple Card will stack up to it.
Most interesting claim is that there are no late fees. If you don't pay it on time, I presume they're going to stop letting you continue making charges to the card until you do? But that it never gets you locked into the debt cycle of so many other cards?<p>If true, this is the true real innovation.<p>Or is there interest, but just no fee for not making your payment on time?
I am impressed, however this any some of the other products announced are just a pinata for anti trust advocates.<p>however this product to me is the premier product of the event. finally someone is taking credit card use to the next level in both usability, features, and security. Most important is the level of privacy they are offering.<p>Now if the three percent discount holds true it will be the defacto means of purchasing from apple.com, similar to how for prime users you pretty much have to use the amazon/chase card for five percent on all purchases.
This sounds like a mediocre credit card (2% back but only with Apple Pay — if you’re okay with cash back on only some transactions, there are much better cards) with some benefit in the form of a nice experience.<p>I guess that, if Apple’s marketing power can sell a ton of these, there’s considerable upside for them, but it doesn’t sound like a truly impressive innovation.
With the rise of smartphone payments like Samsung Pay, Android Pay and Apple Pay , is there even a need for credit cards?<p>How long until these companies start skipping payment processors like Visa and Mastercard and take the whole pie?
I want to know what sort of extended warranty insurance they will provide. There was no mention of this in the presentation today. They mentioned giving 3% cash back on anything bought from Apple. Right now American Express is giving me 3% back on all computer purchases and extending AppleCare by 2 additional years. I made the most recent purchase with that card via Apple Pay.<p>So if I went out and bought a new MacBook Pro today, either AppleCare or American Express will pay to repair or replace it for the next 5 years, until March 25, 2025. (Just for using the card).
Just allow me to create as many 'virtual' credit cards from a single card and that's enough. Every single provider that promised that feature has either underwhelmed, or gone out of business.
Not sure what to think of this. Somehow I would prefer if Apple kept building technology platforms that then enable other parties to develop solutions but instead they seem to be moving into a totally integrated platform. The business success is there but from a technology point of view I find Apple has been pretty unexciting over the last years. They have turned into a well run big tech company like Microsoft under Ballmer. Good business but not very exciting.
<a href="https://www.economist.com/business/2017/10/28/apple-should-shrink-its-finance-arm-before-it-goes-bananas" rel="nofollow">https://www.economist.com/business/2017/10/28/apple-should-s...</a><p>(2017) 'The world’s biggest firm has a financial arm half the size of Goldman Sachs'<p>'...Apple says that its “value-at-risk” (VAR), a statistical measure of the maximum likely loss in an average day, is $434m. That is huge: similar to the combined VAR of the world’s top ten investment banks. In theory losses on derivatives would be offset by gains in the value of Apple’s underlying business. But the sheer size of these positions gives pause for thought.'<p>'...Its foreign operation swims in cash while its domestic one drowns in debt. Profits made abroad are kept in foreign subsidiaries. That way Apple does not pay the 35% levy America charges when earnings are repatriated. Some 94% of Apple Capital’s assets are “offshore” and cannot be tapped for ordinary purposes. The domestic business must do the hard work of paying for dividends and buy-backs. Its profits are not big enough to cover these, so it borrows. Domestic net debts have risen to $92bn, or five times domestic gross operating profits. Each year Apple must issue $30bn of bonds (including refinancing), similar to the average of Wall Street’s five largest firms.<p><i>Apple’s core business is so profitable that it is—almost—inconceivable that a blow-up at Apple Capital could lead to it needing taxpayer or central-bank support, as was the case for GM and GE. Still, it is easy to imagine how Apple Capital could hurt its parent. A market shock could lead to losses on its portfolios. A two-percentage-point rise in interest rates would result in a loss of $10bn. If bond markets dried up, Apple might struggle to issue so much debt and have to bring home funds, incurring a big tax bill. It might also become tricky to run such a big derivatives portfolio.'</i>
How does something like this work in Europe with no signature on the card? When I tried to use a US card without a PIN that I hadn't yet signed, a German checker made a fuss about the missing signature. This isn't a problem in the US where no one bothers checking the signature.<p>What about a brewery I went to this weekend where neither swipe or chip was available for their POS and the card number was manually entered?
> get a digital card that they can use anywhere Apple Pay<p>Apply Pay users: how broad is Apply Pay adoption? Is this a viable replacement for a VISA, Mastercard or AMEX?<p>I'm intrigued by the privacy angle to this, seeing as VISA and Mastercard apparently share and/or sell a lot of transaction data with/to third parties.<p>Edit: The article has been updated: <i>As rumored, Apple is partnering with Goldman Sachs for Apple Card, with Mastercard handling payment processing.</i> The mastercard network, plus the benefits Apples is offering (eg 2pct cashback), could make this <i>really</i> attractive.
I got all excited and then realized that almost none of the new services that were announced will offer me anything as a European.<p>Apple Card most likely won't be coming to Europe any time soon. The streaming service is also not likely to come to Europe as it includes US-only services such as Hulu and Amazon Prime.<p>I am aware that this is a bit of a 1st world problem, but all of these services being US-only can be really annoying. Recently I tried to legally stream Battlestar Galatica in Europe. Not available on Netflix or HBO. So I figured I can rent the show from iTunes. Nope, only in the US. How about Amazon Prime? Nope. US only. In the end, I pirated it from one of the private torrent trackers we have here. I was willing to pay and watch it legally. But aside from ordering the blu-ray discs, I had no choice. Wanna keep piracy alive? This is how you do it.<p>I do understand why these services are not _yet_ available in Europe. It doesn't make it less annoying though.
There was a big emphasis on privacy. Apple does all the categorization and geolocation on device. There was a slide dedicated to the point that Goldman Sachs will never share the data with advertisers.<p>But no word on MasterCard. Will they share the data, is that their business?
If the credit card does not have any numbers on it, how do you make purchases online on sites that don’t directly accept Apple Pay? Does the Wallet app on your iPhone generate virtual card numbers on request that you can use online? Or are you only allowed to use it at websites that explicitly accept Apple Pay? I read through all the official Apple PR stuff and the fine print, don’t see any mention of this.
This blog post [1] from 2016 seems prescient, linking Apple's stance on privacy with it's hypothesized desire to become a bank.
It was a good read, hence why it jumped back to mind 3 years later.<p>Key point:<p>"Here's my theory: Apple see their long term future as including a global secure payments infrastructure that takes over the role of Visa and Mastercard's networks—and ultimately of spawning a retail banking subsidiary to provide financial services directly, backed by some of their cash stockpile. "<p>---------<p>[1] <a href="http://www.antipope.org/charlie/blog-static/2016/03/follow-the-money-apple-vs-the-.html" rel="nofollow">http://www.antipope.org/charlie/blog-static/2016/03/follow-t...</a>
> There will be a physical titanium card, too, but there’s no credit card number, CVV, expiration date, or signature. All of that authorization information is stored directly in the Apple Wallet app.<p>Does this mean that the card doesn't contain sensitive information in the chip or mag stripe? Will only work if it's near your phone?<p>If so, this is quite different from status quo, and touches on what the Coin card failed to do.
I like the value proposition; simple and more transparent credit management with increased privacy. This now has to complete with cards that have consumer purchase protection, customer service, and airline benefits.
Official announcement <a href="https://www.apple.com/newsroom/2019/03/introducing-apple-card-a-new-kind-of-credit-card-created-by-apple/" rel="nofollow">https://www.apple.com/newsroom/2019/03/introducing-apple-car...</a><p>"Apple Card will be available to qualified customers in the US this summer." so US only
Whatever the potential additions for Apple's service revenue, this seems like it will be a highly effective weapon to add to the arsenal for customer retention.<p>Switching to an Android phone at your next phone upgrade cycle will be a lot harder if it also means you need to switch your credit card. Plus, giving users a better rewards rate for using Apple Pay over the physical credit card will encourage them to build the habit of paying with their actual iPhone (and as a follow on effect, probably help encourage further Apple Pay adoption among merchants).<p>Smart defensive move as device manufacturers face an ever more saturated market.
As a non US person. Can someone explain the innovation of this? What should be better here? Is there anything I have missed?
As I understand from the Wikileaks cables, the American government prevented Russia to establish their own credit card system. So they can better spy on the people as they have full access to MasterCard and visacards transactions. So how can this be about privacy?
I'm guessing the 'virtual' aspect of this card will be activated relatively soon - before the physical delivery of the new sleek metal card.<p>Small businesses are the ones who still get bitten by fees, not just on payment processor level but on the physical machines themselves, the fees are still pretty high with some of the larger players locking companies into longer contracts too. [1] This needs to change.<p>There seems to be a lot of consolidation playing out too with the likes of WorldPay (who are the largest payment processor here in the UK) getting acquired [2].<p>[1] <a href="https://merchantcards.co.uk/providers/" rel="nofollow">https://merchantcards.co.uk/providers/</a>
[2] <a href="https://www.finextra.com/pressarticle/72211/vantiv-closes-worldpay-acquisition" rel="nofollow">https://www.finextra.com/pressarticle/72211/vantiv-closes-wo...</a><p>[1]
When will they confirm every non-US jurisdiction for meeting compliance in FinTech? i.e. is this just another 'in the US market' announcement? Maybe for apple that IS the market. For Google, its been acknowledged that whilst mountain view likes to release in the USA first, and it is the single biggest market they have, its not actually bigger than the others put together: far from it.<p>Secondly, Most cards run for profit on card processing fees. They are a profit centre to the bank. Is apple running this at a loss for other reasons or is this model of card cash-positive inside 1 year? Because its a long way to the bottom when you have a giant pile of cash, but at some time, in a year based financial reporting regime they will have to account for this thing, and if its not visibly in profit then either they have an opportunity cost/loss or a real world loss.
Commenting on the video of the event in 7 minutes:<p>1. Apple News was announced again? I think it was already released wasn't it? Still not interested though. No matter how much "AI" they use to make recommendations.<p>2. Being forced to have an iPhone to have a credit card that seems like any other card sounds like a terrible idea. Plus where I live we already have multiple apps and services that allows me to create an infinite amount of cards and transfer money with zero fees.<p>3. The single game subscription seems interesting, specially the part where they say they can also be played offline. I wonder how they do that. I don't play games anymore, still, interesting, wouldn't mind trying it.<p>4. tv.channels looks like other similar services, and they seem to imply you can only use their app on smart TVs and their devices, which is a big no-no. Still, if with good shows and price competitive...
I wonder if the extra cash back for Apple Pay will help spread the adoption of contactless payment. I imagine consumers might shop more at places that take it for the extra cash, and more vendors may start accepting contactless to lure those customers. I guess this depends on how many people end up using the card.
686 Comments,<p>300 of those are Apple getting too much power and stepping into your payment. And Needs to break up Apple or Google or Amazon or whatever. Not sure why it matters as this is not Apple's first CC, they have had Barclaycard Visa with Apple Rewards as told in the 2nd Section Comment.<p>200 of those are Apple Card not having the best Rebate, as there are many other cards offering much higher rebate with no annual fees. I mean seriously, did anyone expect Apple to offer the best Rebate Card? No one is mentioning You are basically trading around 1% of your Spending discount for your privacy and Data. Along with better Financial Planning from your Data on Devices.<p>100 of those are about Visa / Master having duopoly and getting all the money. Well there are actually lots of other companies, transaction fees, cost and Interchange fees involves and Fraud Protection.
> there’s no credit card number, CVV, expiration date, or signature, with all that authorization information stored directly in the Apple Wallet app.<p>I understand the point is to increase Apple Pay usage, but how would I use this card with online websites which don't support Apple Pay?
“Goldman Sachs will never sell your data to third parties for marketing and advertising.”<p>What if we wanted a more general promise to not sell our data at all? Or to not use it for anything at all except for processing transactions? The loophole is so big one could drive a truck through it
In terms of just rewards, is this card competitive with current offerings?<p>3% on Apple products is great. However, I only buy a new product once every half, minus Apple TV subscription.<p>The 2% cashback is only on purchases made through Apple Pay. I already carry the Citi Double Cash card, which does this.
I remember reading an article a few years ago that said Apple has so much money overseas, the most logical thing they can do is to start a bank. Can't find it atm (I'm on mobile). But maybe that has changed after the GOP's tax law changes.
I wonder how this is reconciled.<p>"Apple also says that it’ll use machine learning and Apple Maps to label stores that you use in the app, and use that data to track purchases across categories like “food and drink” or “shopping.”"<p>"Like many of Apple’s products, privacy is a big push here. “Apple doesn’t know what you bought, where you bought it, and how much you paid for it,” said Jennifer Bailey, VP of Apple Pay. All of the spending tracking and other information is stored directly on the device, not Apple’s servers. The company also promises that “Goldman Sachs will never sell your data to third parties for marketing and advertising.”"
I laughed only when I read the last sentence "The company also promises that “Goldman Sachs will never sell your data to third parties for marketing and advertising.” Never trust Goldman when a profit is already built in.
No mention of whether Apple+Goldman Sachs will take over the 0% financing currently handled by BarclayCard for new Apple products. That company’s implementation is antithetical to the values expressed by Apple at this announcement: they retroactively apply interest if you miss a payment or don’t pay off the balance before the promotional period ends; the promo period varies by the amount purchased and the dates only appear on a PDF of the statement; rewards are doled out only after accruing at a certain amount (expressed as points), etc
What interests me is that they've clearly gone after the dark patterns of their opponents or their blatantly obvious unimplemented features (ie better use of mapping to categories behaviour or clear statements about not abusing the data they gather).<p>This is a much more compelling sales pitch than "forget about these suspicious practices, everyone does that, but hey isn't this convenient!" which is so common now with the others.
This should be interesting to watch. Most of the big issues are moving online payments over to a 3d secure spec. 3DS is analogous to what the chip and pin did for physical credit cards when upgrading from magnetic strips.<p>The thing is, it requires the capturing of all of the information Apple claims to not be gathering and then some....in fact, depending on the device you are using it on some of the data capture for 3DS can be downright creepy.
> Apple doesn’t know what you bought, where you bought it, and how much you paid for it<p>But surely many intermediaries do know this information and store it forever?<p>I'm not sure I see the value of <i>Apple</i> not knowing this information, when credit cards are inherently one of the most trackable and most-tracked purchasing mechanisms ever.
It's bad that the card doesn't have a printed number on it. Many merchant systems require merchants to type in the last 4 printed digits on the card for transactions over a certain amount. Some hotels require it, no matter what the amount. These transactions won't go through with Apple Card.
Does Apple Pay and Google Pay work anywhere I see the tap symbol (looks like a rotated wifi symbol)? Or they must also display the Apple or Google Pay symbol? I've seen places that just have the tap symbol and wondered if I could've used my phone.
I hope this is expanded beyond the US. I would get in a heartbeat; if Apple can expand this offering to Europe and other parts of the world with very little use of credit cards they will be able to create new business at a massive scale.
Would they be able to start offering discounts for those who make purchases with an Apple Card vs other credit card? Would be interesting to see if we are having a “credit card neutrality” discussion here in the not too distant future.
"Variable APRs range from 13.24% to 24.24% based on creditworthiness. Rates as of March 2019."<p><a href="https://www.apple.com/apple-card/" rel="nofollow">https://www.apple.com/apple-card/</a>
Seems like a subpar card in terms of points. I also find it odd that Apple, a company notoriously averse to discounts and deals, is entering a sector absolutely dominated by nothing but discounts and deals.
This presentation by a16z talks about the next gen tech of consumer spending:<p><a href="https://www.youtube.com/watch?v=gK9owf0PSZU" rel="nofollow">https://www.youtube.com/watch?v=gK9owf0PSZU</a>
How does one pay the bill to Apple? I never owned a credit card, only debit cards, and they are tied to your bank account. As I understand it, bank transfers pretty much doesn't work in the US and it not really the way you'd want customers to pay of credit card bills anyway.<p>Denmark has a services that will ensure that your bills are paid automatically, on time, from a bank account you choose. I just never heard that the US having anything similar.<p>I would assume that you can't pay of you bill with another credit card, seeing as that would be illegal, at least in some countries.
I for one love this card and Apple’s direction. I’ll be signing up ASAP.<p>No fees. No penalties. Baked into iOS via the wallet and cash back available daily? Count me in!
Where’s my perks?<p>Lounge access?
Hotel discounts?<p>No reason for me to switch from my AMEX or Costco card for puny Apple points.<p>Unless I missed something.
Am I the only one who thinks Apple may have run out of ideas? Credit card business is messy with fraud, late payments, disputes, customer service issues etc. This will have anything but a positive impact on the Apple brand. Also, Apple will be a junior partner to Goldman who will do the heavy lifting. Why would Apple want to be the junior partner to Goldman Sachs?
God these apple events always tend to get massively cringey. Was it the Goldman Sacks partnership? Perhaps it was the titanium credit card I didn't know I needed... Maybe it was the 30+ minutes devoted to a Netflix clone. Or, maybe it was Oprah... "All connected throoough APPLE!!!!!!!!!!"<p>I'm not sure. But somewhere along the way, I lost my lunch.
"No late fees"<p>then...<p>"The company also notes that “late or missed payments will result in additional interest accumulating toward the customer’s balance."<p>Reality distortion field is still going strong I see.
Maybe Tim Cook picked this strategy up over dinner with Trump.<p>Trump - "And all these people lined up to pay me to put my name on their products".<p>Tim Cook - <i>Silently taking notes</i><p>Trump - So, I was telling you about ... Tim, Tim Apple?<p>Tim Cook - Will be back later, on a call with Goldman + Mastercard.
The 2% cashback is especially interesting (in the US, for purchases done with ApplePay). I guess they can get away with a different risk model when they control more of the payment process & security.