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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

#261

Post by 404mm »

ceejayoz wrote: post #108
johnbatin wrote: post #19

Unsurprising since we've heard about this in the past. I wonder if there is another issuer(s) lined up for the card and the savings account. The savings account doesn't have the highest interest rates, but I like how my Apple Card cashback can go right into the savings account. It's kind of like a set it and forget it type of thing. I'm hoping this isn't the end of the Apple Card or the savings account though. It's n…

2% on everything - no Apple Pay required - is widely available. Citi, Wells Fargo, and PayPal each have a 2% no-annual-fee card. It's not that hard to get 5% back on Apple products if you're willing to buy Apple gift cards from a grocery store, either.

Yup, grocery store or a book store.

I agree, those benefits are easily obtainable elsewhere. I do like the automatic 0% interest on all Apple purchases. Not that I need it but it’s nice to keep the money if there is no reason to pay all upfront.

Everybody mentions the positive features about Apple Card, but I’d like to point out that besides the really good cash back, the card is quite bare bones. No extended/doubled warranty on purchases, no purchase return protection, no device drop protection..

Re: Apple pulls plug on Goldman credit-card partnership

#262

Post by epc »

xyst wrote: post #116
giobox wrote: post #8

Seemingly both sides have wanted out of this deal, earlier in the year there was another WSJ report with Goldman wanting to end it as well: > https://www.wsj.com/articles/goldman-is-looking-for-a-way-ou... The earlier story from June suggested Amex might take it over.

That would be cool. Amex support way better than GS that’s for sure. Would suck for retailers though. Amex fees among the highest when compared to other networks and issuing banks. On the consumer side, I tend to see Amex as not widely accepted. Especially drops when traveling.

It matters a lot less than it used to. With the exception of working on the Olympics I’ve been able to use an Amex for most travel expenses since 2000. What was more of a pain was the lack of EMV chips in US credit cards for a long time.

Re: Apple pulls plug on Goldman credit-card partnership

#263

Post by rtpg »

georgespencer wrote: post #234
rtpg wrote: post #187

Earlier quoted context omitted.

My bet is more that GS wanted out, and Apple wants to save face because "the leads we brought GS have double the default rate of other cards" is a bad look for future partners.

> Apple wants to save face because "the leads we brought GS have double the default rate of other cards" is a bad look for future partners. Pretty sure I must be misunderstanding you. Do you really mean to suggest that Apple's reaction to Goldman breaking up with them was to start briefing the press that they dumped Goldman first with the intention of somehow hiding or diluting the poor default performance of the car…

I mean you listed plenty of reasons the relationship is bad. But those are all pretty good reasons for GS to want to bail! Like "Apple is a PITA demanding all bills come due on a specific day for everyone" does not lead to "Apple wants to terminate the relationship".

As anyone who has dealt with vendor integrations would tell you, when one side has a list of demands about how something should work, you know it's going to be a headache. Though I am still legit confused as to how GS ended up being the partner (beyond the cynical "every other company laughed Apple out of the room", which is not a great sign for Apple either!)

I have no inside info, but like you I know that GS is pulling out of consumer stuff in general. Let's just say that in a relationship where GS was constantly, constantly, constantly leaking complaints to the press, it's not a huge logical jump to think that GS would want to end such a relationship.

This is all just gossip of course. None of this matters, and I have no horse in the race. It's just fun to think about.

Re: Apple pulls plug on Goldman credit-card partnership

#264

Post by twobitshifter »

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 guess is the although Apple got great terms on the deal leading GS to lose money, they had a reputational risk with GS since the service was poor and GS had no incentive to invest in improving it.

Re: Apple pulls plug on Goldman credit-card partnership

#266

Post by Balgair »

mkii wrote: post #138
ceejayoz wrote: post #82

Earlier quoted context omitted.

Yeah, there's a /r/AppleCard on Reddit and it was full of examples of reps just making shit up. Completely false information pulled out of their asses.

People are worried over AGI, but I claim it's already here depending on which human population you compare against.

What's the old saying?

You don't have to run faster than a bear, just faster than the person next to you.

Re: Apple pulls plug on Goldman credit-card partnership

#267

Post by initplus »

mvc wrote: post #218
initplus wrote: post #150

Earlier quoted context omitted.

What is the underlying reason these consumer offerings have been such a failure? Something like a savings account should be the closest thing to free money there is - stick the cash into t bills, collect a margin on top and pass the rest back to the customer. Do the marketing/cs costs really outweigh the margin? Or is it some issue with how the assets backing the account are invested?

Goldman is known for servicing ultra-wealthy and business clients. Consumer finance seems like a completely different beast to me. Tighter margins. Lots of low-paid call center staff and low-paid managers to crack the whip. Folks at Goldman would rather be on the golf course doing shady deals with Trump and Musk.

I guess I still don't understand... how much customer service do you need to run a savings account? How do you even screw that up?

Operating a savings account like this one should be close to just picking money off the free money tree. It's wild to think that it costs them more to operate this than the margin they take off it.

Re: Apple pulls plug on Goldman credit-card partnership

#268

Post by jquast »

adastra22 wrote: post #214
hagy wrote: post #197

Earlier quoted context omitted.

The default settlement account, Vanguard Federal Money Market Fund, has incredibly low credit risk because its assets are short-term US Federal gov debt and Federal Reserve repurchase agreements. [1] Neither of those entities have substantial default risk. Further, the global financial chaos of significant defaults from either of those entities would likely render FDIC insurance ineffective because too many banks wou…

Or Vanguard could collapse from the inside because some C-level officer was dipping into customer funds to cover some bad investment, and everyone takes a haircut on the holdings. On top of the drop in market value because most vanguard customers invest in vanguard funds, which suddenly become a toxic asset. Your "safe" money market asset is considered equal and paid out pro-rata, sharing the loss of those mutual fun…

https://investor.vanguard.com/investor-resources-education/a...

I’m very certain that even in the crazy case you have outlined, SIPC insurance would cover up to a half million. Some brokers provide additional insurance beyond the regulatory requirements.

I think everyone recently learned about FDIC because of SVB etc., but I think it’s important that people are also aware of SIPC, and especially to consider that there is no crypto currency exchange that offers any such insurance of any kind, https://www.forbes.com/advisor/investing/cryptocurrency/cryp...

Re: Apple pulls plug on Goldman credit-card partnership

#269

Post by arcdigital »

throwaway2037 wrote: post #158
arcdigital wrote: post #66

Earlier quoted context omitted.

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: Str…

This reply is awesome. How do you know all of this?

I’ve worked in payments for a long time (I did payments at Amazon, Lyft, and Blizzard). Also used to run a company similar to Stripe.

Re: Apple pulls plug on Goldman credit-card partnership

#270

Post by [deleted] »

wkat4242 wrote: post #258
dukeyukey wrote: post #254

Earlier quoted context omitted.

> In Europe, banks don't like you taking out credit cards. Borrowing money is viewed as a weakness and it's best to never do it. Don't know about that, "Europe" is a big place. Credit cards are pretty common in the UK at least, and stuff like balance transfer cards (for shuffling) are too. Maybe not to American extents, but hardly a weakness. In fact, looks like more people in Iceland, Norway and Switzerland own cred…

Well the UK is a similar state to the US. I don't believe this about Switzerland though. They are a very typical people that abhors spending money you don't have. But I think they may be counting debit cards there.

[deleted]
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