Citigroup Reportedly Passed on Apple Card Due to Profitability Concerns

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Original poster
Apr 12, 2001
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Apple is set to launch its own credit card this summer in the United States in partnership with investment bank Goldman Sachs and Mastercard. The aptly named Apple Card will be built into the Wallet app on the iPhone, with a physical version available for use at stores that do not accept contactless payments.


Apple is aiming to shake up the credit card industry by collecting no fees whatsoever, offering one to three percent cash back paid out on a daily basis, and providing consumers with interactive features such as color-coded spending summaries in the Wallet app to assist with spending and budgeting.

Now, a report says those consumer-friendly plans led some other banks to ultimately pass over the Apple Card opportunity.

According to CNBC, Citigroup was in advanced negotiations with Apple over the card, but pulled out amid doubts that it could earn an acceptable profit on the partnership. The report claims that other banks, including J.P. Morgan Chase, Barclays, and Synchrony, also bid on the Apple Card business.

Goldman Sachs has an advantage over those other banks since it does not already offer its own consumer credit cards, so it does not have to worry about potentially cannibalizing one of its own businesses.

"Goldman Sachs seeks to disrupt consumer finance by putting the customer first. We are excited for customers to use Apple Card, which is designed to help people take control of their financial lives," a spokesperson for the bank told CNBC.

Apple Card support will likely be added in iOS 12.4, with some Apple employees already receiving their physical version of the card.

Article Link: Citigroup Reportedly Passed on Apple Card Due to Profitability Concerns
 

zorinlynx

macrumors 603
May 31, 2007
6,051
8,564
Florida, USA
I already have two credit cards and don't really desire a third, but I'd be lying if I said I wasn't considering this. It looks cool, has good terms and if I end up not using it, no harm at all.

I do wish they paid at least 1.5% cash back on physical card (non-Apple Pay) transactions, though. Chase gives me 1.5% cash back on everything, and Apple Pay acceptance is very hit or miss around here. Particularly restaurants tend to not take Apple Pay.
 

martyjmclean

macrumors 6502a
Jan 24, 2018
631
2,354
Sydney, NSW
I don’t blame them, I’ve got a feeling this Apple Card won’t be as successful as Apple hopes. They can’t even launch Apple Cash outside America, what makes them think they can launch a credit card? Most countries (especially Europe) are very averse to credit cards.
 

BootsWalking

macrumors 65816
Feb 1, 2014
1,305
7,621
Goldman Sachs seeks to disrupt consumer finance by putting the customer first.

Like how Goldman put their Credit Default Swap customers first, when they stopped answering the phone when it came time for them to pay their customers' swaps, and even refusing to recognize the market price of those swaps that moved against them? Goldman only puts their customers first when it's profitable for them to do so. In other words, never.
 

Mike MA

macrumors 68020
Sep 21, 2012
2,046
1,679
Sometimes it’s about marketing and an investment to increase ones customer base. Probably especially when doing business with Apple profit often is generated at Apple itself.
 

mattopotamus

macrumors G5
Jun 12, 2012
13,665
4,069
Plus Citi has the DoubleCash, which is basically a better version of this.
[doublepost=1559054761][/doublepost]
Yeah, except that most people who actually need financial control and assistance aren't going to be able to get this card. Weren't people on the forums saying you need a credit score of 800 or higher? Seems to be another case of the rich keep getting richer. Not that people that have over 800 are rich, but you'd be very hard pressed to find any poor person with a score over 800. Mine is over 800 and I am not rich but comfortable, but a card like this when I was younger would have been useful.
Doubtful. I cannot think of a single credit card that requires 800+. Amex Platinum and CSR (two of the most prestigious cards) don't have those requirements.
 

G5isAlive

macrumors 6502a
Aug 28, 2003
868
1,157
Yeah, except that most people who actually need financial control and assistance aren't going to be able to get this card. Weren't people on the forums saying you need a credit score of 800 or higher? Seems to be another case of the rich keep getting richer. Not that people that have over 800 are rich, but you'd be very hard pressed to find any poor person with a score over 800. Mine is over 800 and I am not rich but comfortable, but a card like this when I was younger would have been useful.
So your whole comment is based on what you read in a forum here regarding something no one can really know? I have a bridge for you
 

uniquexoxo

macrumors 6502
Aug 27, 2018
426
291
South East Asia



Apple is set to launch its own credit card this summer in the United States in partnership with investment bank Goldman Sachs and Mastercard. The aptly named Apple Card will be built into the Wallet app on the iPhone, with a physical version available for use at stores that do not accept contactless payments.


Apple is aiming to shake up the credit card industry by collecting no fees whatsoever, offering one to three percent cash back paid out on a daily basis, and providing consumers with interactive features such as color-coded spending summaries in the Wallet app to assist with spending and budgeting.

Now, a report says those consumer-friendly plans led some other banks to ultimately pass over the Apple Card opportunity.

According to CNBC, Citigroup was in advanced negotiations with Apple over the card, but pulled out amid doubts that it could earn an acceptable profit on the partnership. The report claims that other banks, including J.P. Morgan Chase, Barclays, and Synchrony, also bid on the Apple Card business.

Goldman Sachs has an advantage over those other banks since it does not already offer its own consumer credit cards, so it does not have to worry about potentially cannibalizing one of its own businesses.

"Goldman Sachs seeks to disrupt consumer finance by putting the customer first. We are excited for customers to use Apple Card, which is designed to help people take control of their financial lives," a spokesperson for the bank told CNBC.

Apple Card support will likely be added in iOS 12.4, with some Apple employees already receiving their physical version of the card.

Article Link: Citigroup Reportedly Passed on Apple Card Due to Profitability Concerns
Of course. Fraudulent Banks like Citi won’t take on something they can’t put hidden charges on. ‍♀
 
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fourthtunz

macrumors 65816
Jul 23, 2002
1,187
653
Maine
Does anyone else find this whole thing humorous?
Like these banks are not all working together? :)
 
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macduke

macrumors G4
Jun 27, 2007
10,939
14,624
Central U.S.
So your whole comment is based on what you read in a forum here regarding something no one can really know? I have a bridge for you
I remember hearing reports from multiple people saying they were declined with scores in the mid to upper 700s. Haven't followed up since. Feel free to provide evidence instead of criticizing my comment.
 
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Polymorphic

macrumors regular
Dec 23, 2010
148
429
I like the Apple Card in theory, but there are already no-fee 2% cash-back credit cards out there. I have two of them, and use one of them for virtually all purchases. In a family of six, that 2% really adds up over the course of a year. I can't see using the Apple Card unless Apple increases the cash-back rate for the physical card.
 

uniquexoxo

macrumors 6502
Aug 27, 2018
426
291
South East Asia
Imagine that? A bank not wanting consumers to have complete control over their credit card spending or tools to help them avoid going into debt or spending beyond their means.

How can they make money if people don’t carry a large balance?
Exactly. With a large balance, they can easily slip in some hidden charges here and there lol
 

otternonsense

macrumors 65832
Jul 25, 2016
1,504
4,563
Berlin
It's more like Tim Apple running out of ideas for his "pipeline" and going after ultra-legacy credit territory that isn't even scalable outside of the US (unlike Apple Pay).

Maybe the local US market rejoiced with one more piece of plastic complemented by cute UI, but this announcement has sure left the rest of the world cold.
 

ocabj

macrumors 6502a
Jul 2, 2009
546
188
Lol I love the AMEX drones that have to find something to whine about with Apple Card.
Sorry. AMEX isn't the best thing on the block anymore.
After the Chase Sapphire Reserve card came out, I think that definitely caused most people to rethink AMEX. I still have AMEX, but I still struggle with the idea of cancelling it (or downgrading to Green).

I'd still like to see the full benefits list for the Apple card. Purchase protection and extended warranty are pretty much staple benefits for a credit card, so hopefully those exist.
 
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mlody

macrumors 65816
Nov 11, 2012
1,048
663
Windy City
I like the Apple Card in theory, but there are already no-fee 2% cash-back credit cards out there. I have two of them, and use one of them for virtually all purchases. In a family of six, that 2% really adds up over the course of a year. I can't see using the Apple Card unless Apple increases the cash-back rate for the physical card.

I am in a similar boat. I have no desire to use the card as i also have 2 other credit cards with better deals; however i will still get it purely for the look and coolness.
 
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