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Apple pulls plug on Goldman credit-card partnership

wsj.com

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Re: Apple pulls plug on Goldman credit-card partnership

#61

Post by petemir »

lxgr wrote: post #36
petemir wrote: post #24

Earlier quoted context omitted.

I hate that it works this way, but perhaps an Apple-Amex deal is what is needed for businesses to start accepting Amex. Edit: typo

What would that change? Amex acceptance in the US is basically ubiquitous, and how would a new type of Amex change things abroad?

If the Amex partnership includes global (or at least, European) expansion (which seems more plausible than with GS), it may generate extra pressure on vendors to accept it. iPhone market share is quite high in Europe(~35%), and I’d guess mostly comes from high spending sectors (e.g. 56% in Swirzerland, 50% in UK). I would try to attract their business.

Re: Apple pulls plug on Goldman credit-card partnership

#62

Post by themadturk »

Ajay-p wrote: post #27

I only got the card because I wanted a neat piece of titanium. I used it a few times and then cancelled it. Was I the only one?

We got it for interest-free yearly paybacks (plus cash back) buying a MacBook Air, two watches, and two iPhone 13s. Have put an occasional small purchase on it just to stay active, paid off right away. The titanium card is excellent, though I've only pulled it out once.

Re: Apple pulls plug on Goldman credit-card partnership

#63

Post by kuschku »

sgerenser wrote: post #54
notatoad wrote: post #33

Earlier quoted context omitted.

lower fees is what is needed for businesses to start accepting amex. visa and mastercard are 2-3%, amex is 5-6%. there's no upside for merchants to accept transactions where they have to pay double the processing fees

The difference is not that high. In fact, my understanding is “Visa Signature” and “World Mastercard” (which are most of the premium credit cards) normally cost about the same as Amex. At worst it may be about 1% more not double.

Compared to european payment cards with their 0.125% total fees, Amex' 6-7% is a steep ask.

Re: Apple pulls plug on Goldman credit-card partnership

#64

Post by themadturk »

flwjliwjle wrote: post #28

Good. They should shut down the whole Apple Card program. It was awful. I had an Apple card for two months. In those two months, I had more inexplicably declined transactions than in the other twenty years with other cards combined. Every single time I called support and Goldman Sachs pointed at Apple and Apple pointed at Goldman Sachs and the problem never got resolved. They both did an astonishingly bad job.

Though my use has been fairly limited (Apple isn't inclined to decline their own card), I've never had a problem with the Apple card, either at my Toyota dealership or at Walmart.

Re: Apple pulls plug on Goldman credit-card partnership

#65

Post by kzrdude »

notatoad wrote: post #33
petemir wrote: post #24

Earlier quoted context omitted.

I hate that it works this way, but perhaps an Apple-Amex deal is what is needed for businesses to start accepting Amex. Edit: typo

lower fees is what is needed for businesses to start accepting amex. visa and mastercard are 2-3%, amex is 5-6%. there's no upside for merchants to accept transactions where they have to pay double the processing fees

Card fees are capped in EU, and I wonder if amex has any way of going around that. (0.2% debit, 0.3% credit)

https://eur-lex.europa.eu/EN/legal-content/summary/fees-for-...

Re: Apple pulls plug on Goldman credit-card partnership

#66

Post by arcdigital »

notatoad wrote: post #33
petemir wrote: post #24

Earlier quoted context omitted.

I hate that it works this way, but perhaps an Apple-Amex deal is what is needed for businesses to start accepting Amex. Edit: typo

lower fees is what is needed for businesses to start accepting amex. visa and mastercard are 2-3%, amex is 5-6%. there's no upside for merchants to accept transactions where they have to pay double the processing fees

This is not true. Anyone in the US who has told you this is confused or getting ripped off by a predatory ISO (the companies that offer credit card processing).

Numbers below are only looking at the percentage, not the flat per txn fee or the other fees like assessments, etc... Only apply to the US. Also assuming you do less than 1 million a year in card volume.

First let's look at actual merchant services costs:

Stripe, Braintree/PayPal (online) you pay the same fee for all cards. Around 2.90%

Wells Fargo (in-person) charges the same rate for all cards until you are high volume. Around 2.40%

Chase (in-person) charges the same rate for all cards until you are high volume. Around 2.60%

Bank of America (in-person) charges the same rate for all cards until you are high volume. Around 2.65%

Now let's look at the actual amount the card issuer charges for a restaurant to accept a card (assuming you're working with an ISO that does OptBlue, all the above do). The markup you pay your merchant services provider is added on top of this.

Amex: 1.60% - 2.85%.

Visa: 2.10% - 2.70%.

MasterCard: 1.85% - 2.00%.

Re: Apple pulls plug on Goldman credit-card partnership

#67

Post by arcdigital »

kuschku wrote: post #63
sgerenser wrote: post #54

Earlier quoted context omitted.

The difference is not that high. In fact, my understanding is “Visa Signature” and “World Mastercard” (which are most of the premium credit cards) normally cost about the same as Amex. At worst it may be about 1% more not double.

Compared to european payment cards with their 0.125% total fees, Amex' 6-7% is a steep ask.

It's nowhere near 6-7%. See my other comment for more details.

Re: Apple pulls plug on Goldman credit-card partnership

#68

Post by edvinbesic »

giobox wrote: post #11
parl_match wrote: post #5

Earlier quoted context omitted.

The rumor is that Apple Card will move to Amex. WSJ says 12-15 months, but AppleCard is contractually obligated to use the MC network until 2025. I can't imagine they'll close all those accounts, so likely we'll see some sort of migration leading up.

This would be a bit of a detractor for me, Amex is not as widely accepted, especially when traveling in Europe. Mastercard is accepted virtually everywhere in the EU and UK.

I agree, but would this still be the case if using it through Apple Pay vs swiping the physical card?

Re: Apple pulls plug on Goldman credit-card partnership

#69

Post by buildbot »

dimmke wrote: post #34
balderdash wrote: post #7

I’m curious why Apple is moving to terminate as opposed to getting GS to buy them out of their contract?

My theory about the Apple Card: Goldman Sachs is not setup to be a direct consumer bank. This caused a lot of problems: * The ease of sign up / approval led to a lot of subprime approvals that might not have gone through with a more established lender. Not only did this cause GS to lose money on delinquent accounts, it prevented the Apple Card from ever becoming a status symbol. * Goldman Sachs developed a reputation…

+1 to the whole fraud issue - I had a fraudulent transaction from the apple store, my card but not my account, and they at first refused to believe that the virtual card number could be stolen, which it can as it’s just a credit card number once it’s in a website’s database ripe for stealing. Then they tried to get me to talk to apple to refund it - saying I should give them the order number/details that kind of thing. Which I didn’t have of course! Apple was like, chargeback when I talked to them. Goldman sachs had to be prodded like 4 times before they even started the process. In the end luckily the pending charged never went through so the dispute was closed “in my favor” somewhat.

Re: Apple pulls plug on Goldman credit-card partnership

#70

Post by dimmke »

function_seven wrote: post #46
dimmke wrote: post #34

Earlier quoted context omitted.

My theory about the Apple Card: Goldman Sachs is not setup to be a direct consumer bank. This caused a lot of problems: * The ease of sign up / approval led to a lot of subprime approvals that might not have gone through with a more established lender. Not only did this cause GS to lose money on delinquent accounts, it prevented the Apple Card from ever becoming a status symbol. * Goldman Sachs developed a reputation…

I didn't know about the rep GS has gotten regarding fraud charges. My main card is a Chase one as well. Everything else is spot on. I use the Apple Card only for buying stuff from Apple (for the 3% cash back), or when I accidentally select it from my watch at the vending machine. Rewards are much better on other cards, even if they're not as simple as cash dropped into your account on the daily.

Here's an example of a policy change due to criticism about the dispute issue: https://9to5mac.com/2022/02/11/apple-card-disputes-transacti...
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