Report Delves Into Why Apple and Goldman Sachs Want to Break Up

[airwalk331]

🤣

Apple TV+ is a success?

The Apple Car is a success? That thing's been in development for a decade now with no actual product in sight.

Apple Car Project Scaled Back and Delayed, Won't Feature Full Self-Driving Capabilities

Apple has scaled back its Apple Car project and the company no longer plans to release a fully self-driving vehicle, reports Bloomberg. Apple...

www.macrumors.com

The car isn't here yet- so we'll see on that but most markets Apple has entered (released a product or service for) it succeeds in.

I believe Apple measures success on what they feel will be profitable whether short or long term. Apple TV+ may not be the most popular streaming service but the iphone also wasn't the most popular phone when it first released...

 

[nrose101]

What!?! How tf did a world renowned investment bank known for structuring some of the most complex deals in the industry, get this bamboozled by a bunch of Silicon Valley nerds?

Like crashing everything in 2008?

 

[JPack]

🤣 Yeah, I'm sure American Express is just itching to bring in a large number of sub-prime Apple Card holders.

Goldman’s Apple Card business has a surprising subprime problem

Goldman's consumer business has had a bumpy ride as of late, marked by mounting losses, leadership turnover and missed product deadlines.

www.cnbc.com

- Goldman’s loss rate on credit card loans is the worst among big U.S. card issuers and “well above subprime lenders” at 2.93%, according to a Sept. 6 note from JPMorgan.
- More than a quarter of Goldman’s card loans have gone to customers with FICO scores below 660, according to company filings. That could expose the bank to higher losses if the economy experiences a downturn


Plus...

Those numbers are terrible. Agree Amex wouldn't touch this with a 10-foot pole.

It would be like Costco trying to outsource their $1.50 hot dog business. Ain't nobody dumb enough to take it.

 

[xmarcuswildx]

So…. I don’t have to pay my bill right?

 

[R3k]

Chances are GS customer support will further degrade over the next year. Will save them money putting less resources into it, and will put them in a more favorable position while negotiating an out with Apple, since it’s a big negative to Apple’s image if Applecard gets bad press due to subpar customer service.

Anyway.

Moving forward though, if foreign transaction fees ever make a return, i will be using the card a lot less. It was the main reason i got it.

 

[zinacef]

I just hope Amex is better...but knowing Amex it won't be.

Obviously you don’t know Amex or haven’t done solid long term business with them.

 

[The_Gream]

I just know, if I was the financial institution that was talking to Apple about taking over the back end. I would demand all the cards my network covered to get the same level of integration as the Apple Card in the wallet app.
I am thinking about how companies like Capital One have their own cards, but they also handle a lot of store cards. If the Wallet could do what it does for the Apple Card for all those cards, it would be amazing.

 

[szw-mapple fan]

No annual fees, late fees, or fees for foreign transactions, plus high yield savings. Like it or not, banks gotta eat too.

There are plenty of cards that have similar conditions and with high yield savings. Some even have better rewards and savings rates. I think it’s more of a case with the Apple Card approving people with low credit score or short credit history than anything else.

 

[performa_6400]

The GS partnership was a mismatch. The good news is there are plenty of other great smaller banks out there paying competitive rates that I'm sure would love to have the Apple Savings accounts on their balance sheets.

 

[ifxf]

It seems that a factor was that GS didn’t realize that Apple customers have a higher percentage of whiners then the general population. This raised their customer support costs.

 

[jayducharme]

Retailers pay a percentage of each transaction when taking a credit or debit card payment, and Goldman Sachs gets no funding from this.

That was a mistake on the part of GS. I can't see why Apple would have objected to them getting a cut of sales. I had assumed that they were getting it, as with most card issuers. I worried that GS was an odd fit with Apple from the start, but hoped it was going to work out.

 

[szw-mapple fan]

I do wonder what Goldman's motivation for going ahead with the launch of the savings accounts was - if they were already looking to exit their partnership, that would seem to make it harder to do.

It’s quite possible the people working on the savings account are disconnected from the big decision makers in the company. Like how Google was still signing on new game developers days before Stadia was shutdown.

 

[jimbobb24]

"Investigated for gender discrimination".

Lol the feds will investigate you for one article posted by a journalist on a website one of the feds happens to read. Being investigated by a banking bureaucrat is nothing and including it in the article is nonsense. It means nothing to the company because dumb unfounded investigations are the norm.

 

[Mr. Dee]

In one anecdote relayed by The Information, Goldman Sachs and Apple ran into a glaring issue. Apple CEO Tim Cook was testing the service and was not able to get approved for an ‌Apple Card‌.

Goldman Sachs: You earn what?!? Get the **** outta here. Declined!
Tim Cook: 😐

 

[814MB]

Just shut it down

 

[jimbobb24]

Obviously you don’t know Amex or haven’t done solid long term business with them.

It doesn't matter. It's an exclusive card and I want to use apple pay everywhere. Does me no good to have a card with have the uses.

 

[Sheepish-Lord]

It doesn't matter. It's an exclusive card and I want to use apple pay everywhere. Does me no good to have a card with have the uses.

You’re not wrong about exclusivity but might need to reevaluate the customer service part;

“Compared to MasterCard and Discover, it has issued far fewer cards and is accepted in far fewer locations.

American Express’s business aims to make up for this by charging a premium for its cards and offering a premium customer experience.”

Which Credit Cards Are Most Accepted Worldwide?

Find out which credit cards are the most accepted worldwide so that you won't have trouble paying for a purchase when you travel internationally.

www.mybanktracker.com

 

[deconstruct60]

Because Goldman Sachs was new to consumer banking and was eager to establish a deal with Apple, it is not collecting fees that it would typically get in a partnership for a credit card. Goldman Sachs does not get a portion of the fee that merchants pay to Apple to accept the Apple Card. Retailers pay a percentage of each transaction when taking a credit or debit card payment, and Goldman Sachs gets no funding from this.

Goldman Sachs is unable to collect annual fees, late fees, or fees for foreign transactions because the Apple Card does not charge these fees. Apple does pay for the Daily Cash that users earn, and Goldman Sachs is able to earn money from loans issued to cardholders who split Apple product purchases into installments, but it is not making enough for the deal to be appealing to a new partner.

Apple could decide to partner with a lesser-known bank to handle the regulatory functions while Apple takes over underwriting, fraud prevention, and customer service, but it is not yet clear if that will happen.

Apple could decide to partner with ... who on those terms layered on GS ????? A 'lessor know bank' that wants to let Apple walk away with all the transactional revenue and the bank takes all the liability and transaction overhead? Not sure who would be wants to be treated like a $20 crack ho . Not sure how pragmatically separate underwriting and regulatory compliance . [ If Apple was actively and quickly pushing cash in Goldman Sachs to cover all the bad loans on Apple Cards, then GS probably wouldn't be trying to run away so fast. ]

 

[raythompsontn]

Did anyone notice that the chip on the physical Apple Card is on the right side of the card rather than the left like most cards? The card still works in a chip reader because the vertical orientation and the contacts are arranged to work properly. Just seems the location of the chip is odd. It is, however, a very good looking physical card made of metal.

 

[zorinlynx]

Apple Card changing to AMEX would be a big downgrade since MasterCard is accepted in a lot more places than AMEX. Hopefully it doesn't come to that.

 

[tinsoldier]

My 24 year old cousin, who just started his first, real job, just asked me what a 401k was if he should do it? No-one is teaching these kids about anything.

I’m curious what is a 401k? I’m not in the US but seen the term before no idea what one is.

 

[TPALTony]

Goldman Sachs more interested in profit than customer service.... who could have seen that coming? They are notorious for taking great delight in screwing over their customers when those customers are paying them billions, so what on earth ever made Apple think they would be any different in the consumer space.... Had the Apple Card ever made it to the UK, I would never have wanted one as long as it was being run by GS.

 

[k1121j]

But the article says Apple is responsible for the Daily Cash. I just think they are not making any money or collecting fees, so they are allocating a lot of resources to something that doesn't make them any money.

Oh they aren’t likely loosing money just not making as much as they want. Corporate greed is more like it.

 

[jz0309]

not have had any issues with my Apple Card, not enrolling or any bad customer service while I had a dispute or two ...
switching to Amex - I'll likely dump it, Amex acceptance at stores, restaurants etc is just mediocre ...

this "report" talks about former employees and what those had to say, sure there's some truth to it but also wonder if they talk at the exec level to turn this into a win-win for both ...

 

[mansplains]

I bet they're just making excuses, their real grievances are more likely to be magic mouse charging method, lack of side-loading on iPhone, inability to place apps where wanted on springboard etc