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Apple Debuts Apple Card To Transform the Credit Card Experience (venturebeat.com)
An anonymous reader shares a report: iPhone users are already using Apple's Wallet app, Apple Pay, and Apple Pay Cash -- wouldn't they like an Apple credit card, too? The Cupertino company and bank partner Goldman Sachs believe the answer is "yes," so they've teamed up for Apple Card. In addition to offering major rewards for users, the new payment solution promises to improve the credit card experience by offering a healthier approach to spending. The Wallet app will include a more transparent list of transactions, organized in an easy to read format, plus a more flexible way of making payments on outstanding balances.
Apple Card is designed to complement existing Apple-branded payment options, as well as displacing other credit cards that might be in a user's wallet. Though the end goal is to increase Apple's share of the dollars spent by its users, the pinch this time will be felt by rival payment providers, and come with incentives for new card users. Every time you spend with Apple Card, you get 2 percent cash back -- a feature the company calls Daily Cash. Purchases directly from Apple come with 3 percent cash back.
Apple Card is designed to complement existing Apple-branded payment options, as well as displacing other credit cards that might be in a user's wallet. Though the end goal is to increase Apple's share of the dollars spent by its users, the pinch this time will be felt by rival payment providers, and come with incentives for new card users. Every time you spend with Apple Card, you get 2 percent cash back -- a feature the company calls Daily Cash. Purchases directly from Apple come with 3 percent cash back.
What the copy-paste summary omits is more informative:
Every time you spend with Apple Card, you get 2 percent cash back — a feature the company calls Daily Cash. Purchases directly from Apple come with 3 percent cash back. That could lift the company’s sales of its own products, providing a greater incentive to pay “full price” at Apple than seek discounted prices elsewhere.
Additionally, the card has no fees: no late fees or international fees, with unspecified lower interest rates than competitors. The absence of late fees is jaw-dropping; whether it will be sustainable for the long term is yet to be seen.
Apple Card will be accepted via MasterCard’s global payment network and backed by Goldman Sachs. While the card will be digital and connected to an iPhone, there will also be a physical card made from titanium that can be used in stores; purchases made with the physical card are only eligible for 1 percent Daily Cash.
Another reason to sign up for Apple Card: greater transaction privacy. Apple has maintained that its customers are “not the product” with its services, which is to say that it doesn’t harvest or sell their personal information to profit off their data.
In short, usually 1% (with the physical card) or 2% (if you're using an iPhone) cash back, no late fees, and it's accepted as MasterCard. the "unspecified lower interest rates" sure sound enticing, but I'll wait until they're specified to actually care. Otherwise, it's a bog-standard credit card, but this time with a shiny Apple logo!
You do not have a moral or legal right to do absolutely anything you want.
I was expecting nothing at all from the Apple Card, kind of just a throwaway thing.
But It really is way, way better than most other credit cards, and I say that as someone who has used a lot of different cards for different features.
The thing I like most about it in general is that it is actually for true customer friendly unlike pretty much every other card. I like prominent understanding of how much interest you'll be paying, about making payments not just monthly but more often not reduce interest. I like that there are not things like late fees meant to trap the unwary or the forgetful.
Then on top of that, not just 2% cash back (3% on Apple products/services) but you get that back each day and can use it for anything, not having to remember to navigate through an arcane web interface to make use of cash back credits (like with Spark).
The card itself as a physical manifestation looks great of course, but honestly what I am excited about is how much the way the Apple Card works could possibly start to change how other credit card companies behave....
"There is more worth loving than we have strength to love." - Brian Jay Stanley
This was actually a fairly surprising and somewhat welcome announcement.
As a physical card, it's made of titanium and has nothing more than your name and the chip. No security code, no expiration date, no signature, etc. that can be copied or stolen. You get 1% cash back on everything you purchase with the physical card, it automatically redeems the cash back every single day, and the cash back is available to you for immediate use either as cash or as credit towards your statement. It also randomly generates a new credit card number for every transaction, ensuring that your card can't be used for anything beyond the transaction you're actively engaging in, and Apple apparently collects no information on you about where, when, or how much you're purchasing, while also requiring privacy by default (i.e. you don't have to write in to ask them to not use your info for marketing purposes) from their financial industry partners. There's also no late fees, overage fees, or other fees that you'd typically expect, and you can apply and get approved from directly within the app.
When used via Apple Pay either in-person, in-app, or online, the cash back goes up to 2% (3% for purchases from Apple), with all the same perks.
All of which is to say, they carved away some of the typical cruft and gave it a nice UI to try and make the statements easier to read (e.g. human-readable store names and locations instead of ALL-CAPS abbreviations) and they tried to make understanding payments easier (e.g. interactive calculations for interest payments).
Not sure that this will really change much in the industry, but it's a nice looking card, nonetheless.
A friend and I talked about the Apple Card during the announcement. My friend wants the Apple Card and justifies getting yet another credit card by saying that the average American has five credit cards. He only has one. *facepalm*
2% cards aren't hard to find, though. I have one from fidelity, and my brother has one from discover (which surprised me; the last time I bothered with them, there were so many caps and fractions on its 1%that it wasn't worth keeping.
And it drops to 1% when you use the card out in the real world. I've tried Apple Pay a couple of times, but haven't succeeded yet.
And it's not clear whether online purchases are 1% or 2%.
I don't care about interest rates; I pay my card off a couple of times a week. The only reason I even have it is the kickbacks.
The no currency fees is nice, but my 1.5% capital one already does that.
And the extra 1% on apple stuff doesn't really add up to enough to worry about -- certainly not enough to deal with an extra card.
hawk
Funny, you know, I"ve found it entirely possible to pay my monthly credit card bills in full, and never have to pay a cent in interest fees.
I also have some protection on the purchases, and I often get cash back, etc on my purchases which help with the costs of things.
You've never heard of this "personal responsibility' things and "self-control' nor budgeting?
Did your family and even schools teach you nothing about money management?
Earning a dollar is hard, you need to be careful in how you save and spend them.
However, it isn't rocket surgery.
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
Now I don't mind 2% cash back. However this seems like American Express or Discovery Card, where having such a card means hit or miss in terms of availability. Sorry they Don't take Discover or they don't take American Express. Right now MasterCard or Visa is the only near universal card offered.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
I agree that this isn't exactly "cutting edge stuff" from Apple, here. But it's not too bad either. Seems like a nice, logical extension after offering Apple Pay and the Apple Pay Cash functionality to make all your typical financial transactions happen right from your phone.
I do like the way the cash back bonus is just automatic and paid back within 24 hours of a purchase. Most others make you jump through some hoops to collect them - which surely helps them avoid paying them out to a certain percentage of their customers who forget to do those extra steps.
And issuing a physical card to go with it that has no identifying card info printed on it? That's smart too.
Oh, and BTW: To the people who keep ridiculing Americans and their need to have multiple credit cards? The FICO scores get calculated, in part, based on how much credit you have available to you vs. how much you actually use. So having more cards, even if they sit there unused, benefits you by improving that ratio -- since no one card company is likely to extend you a line of credit as big as you'd have in sum total, spanning 4 or 5 cards.
It's a Master Card so if they don't take Apple Pay you can use the physical card and get 1%.
I browse on +1 so AC's need not respond, I won't see it.
... transaction details with third parties."
BAHAHAHAAHAHAAAAAA
Good one.
2% cards aren't hard to find, though. I have one from fidelity
And the annual fee (which Apple does not charge)???
And it's not clear whether online purchases are 1% or 2%.
The exact percentage does not matter that much though. What is really interesting about this is you get that cash back daily. It's that you don't have to request a check, or go have to go through the website figuring out how to use the cash back in some other way.
my brother has one from discover
I have a Discover card also, that I never use... but you can't use that everywhere (which is why I stopped carrying it), Apple's card will work where you can use MasterCard (which is everywhere).
And the extra 1% on apple stuff doesn't really add up to enough to worry about -- certainly not enough to deal with an extra card.
It would if you were getting a laptop (free $60 back on a $2k laptop). But basically since there is no annual fee the question is why not get one and enjoy the benefits they offer you, along with a true customer focused experience that no other card has?
"There is more worth loving than we have strength to love." - Brian Jay Stanley
This is very different from GE or Sears.
Once Apple Pay gained traction, the next logical step was to eliminate the need for a card. NFC acceptance is spreading, and the need for a physical card is diminishing. And Apple, due to its size and user base, is in a unique position to take on the Visa-Mastercard duopoly. From Apple's POV, the MC option is temporary.
Now with rounded corners, and no headphone jack! Works almost anywhere Mastercard is accepted. As long as you're not holding it wrong.
Eloi are stupid, throw morlocks at them!
Kickback incentives to get people to use a payment brand should be treated as an anti-trust issue as sellers are effectively being held captive by perverse incentives on the back end. It's guaranteed suicide for many vendors to refuse to accept a known card brand.
Also there is no justification for bankers to extract percentages of every transaction for themselves in the first place. This is just a tax extracting value from the system for no benefit in return. Credit cards need to be phased out and banking systems improved to handle push based personal instant payments without transaction fees.
...Did you watch the announcement video? Do you use many other credit cards?...
Yes and yes. I'm still underwhelmed. Of all the things you list, the lack of a late fee is the only one I would call a significant improvement. However, in my decades of credit card usage, I've never paid a late fee, so that would be a feature I don't need. As per usual with Apple, lots of hype, a shiny object, and only minor improvement. But the Apple fans go wild.
.
It's a yawn painted up to look exciting. Has Apple really run out of ideas?
Monopoly on WHAT, exactly?
They're not the only one selling computers.
They're not the only one selling cell phones.
They're not the only one selling tablets.
They're not not the only place to try to sell your apps
They're not the only place from which to buy/rent media of various kinds.
What exactly are they supposed to have a monopoly ON? Apple didn't invent vertical integration, nor is it the only company that profits from it. It also isn't a monopoly.
The APR is actually 13.24% to 24.24%
(Scroll down to very end and read fine print to see)
That seems about average to me, but I still think the other features are exciting and helpful enough they will get good traction.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
You use the app to generated card # w/ expiration date and CVV for online purchases.
I really appreciate you people who do not use credit cards, you help support the award programs for those of us who do!
That's as good a way as any to justify cheerleading for bankers to extract value from EVERYONE for absolutely nothing in return.
It's very kind of you to buy everything at inflated prices to support credit card transaction fees while getting none of the rewards... more for me then!
This isn't a zero sum game. They are taking value from you as well.
Only I don't pay any yearly/monthly fee for using it.
There are plenty of rewards cards for which there no no annual fees. I have several of them.
USAA Rewards Visa Signature® Card - no annual fee
USAA Rewards American Express® Card - no annual fee
Costco Anywhere Visa® Card by Citi - no annual fee (Costco membership required)
Amazon Prime Rewards Visa® Signature Card - no annual fee (Prime membership required)
I'm sure there are many others.
So, did you enjoy your time in band camp?
If you pay interest, you're doing it wrong.
Since you are using Apple Pay, you have an iPhone. You whip out your phone, launch Wallet, tap the card you want to use, and then (new interface stuff is necessary, so we are guessing based on what Apple told us) you hit the "..." for more information, and then hit a button to generate a CVV, expiration and number for you. This isn't lock-in, per se, but it is an incentive to remain in the Apple ecosystem.
However, in my decades of credit card usage, I've never paid a late fee>
Neither have I but I know credit card companies make a bundle on various fees. That's why I say the Apple Card is such an awesome product, it's not that it changes my life much in terms of card use, but I think it could overall help a ton of people out from being skimmed by credit card companies, all of the people who sometimes pay late (which I don't) or those people who carry a balance (which I almost never do).
In a way it's almost an educational tool about using credit cards because it displays so much information so clearly about what is going on. It's a bit like letting everyone have a fancy business card with improved visualization features, but also training them how much interest really affects what they truly pay, and encouraging them to pay more often to reduce it...
I honesty believe it will be a transformational product, in that it will affect how other credit card companies do business eventually. It will force some movement for the better in an industry that has hardly changed in decades.
To me, the Apple Card was by far the best new product they announced today... followed closely by Apple Arcade.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Pay the entire bill at the end of the month, never pay a cent of interest.
If you're letting your balance roll over, you are doing it wrong.
Credit cards can be a very handy tool, both for getting cash back as well as protecting yourself when purchasing items. Things like chargebacks and all the additional protections the card issuer grants are way better than walking around with a bunch of cash.
"Well kids, you tried your best, and you failed. The lesson is, never try." -Homer Simpson
A company like Apple with a huge hoard of capital and something like a monopoly on its products soon begins to act and think like a financial services company.
There is too much risk actually innovating within its field, and because of its monopoly-like control over its products, it doesn't actually need to innovate. The risk of innovation is of course failing, and the capital it spent on the innovation project being wasted in comparison to some other use, such as holding T-bills.
Thus management stops thinking about product innovation and starts thinking about capital innovation, and usually this winds up being some kind of financial service business since it tends to have the same low level of risk as other highly liquid financial instrument, except with slightly higher margins.
On your second point you are somewhat wrong. Most (all?) of the credit card merchant agreements specifically forbid merchants from charging more for the use of a credit card. Any merchant found doing that loses their account (and ability to take credit cards). Whatever the advertised price is on the sticker must be the price charged to the card.
There is a loophole here: you can charge other methods (e.g.: cash) less than advertised price. But in most cases merchants like the lower amount of side-work (e.g.: carrying cash to the banks, who increasingly don't like handling cash themselves), and so encourage card used (though they like the lower fees and risks to them of debit cards).
They do. Americans are so fucking stupid, it's unbelievable. They'll take a 1% discount on their cards, while paying an extra 3% to the card processors on the back end.
I don't respond to AC's.
My friend wants the Apple Card and justifies getting yet another credit card by saying that the average American has five credit cards. He only has one.
That's actually a really good reason. What if one is stolen? It's great to have a backup.
It also improves your credit score to have another account open, even if he never uses it.
Sounds like he's pretty smart about this, you should not ridicule him.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Hey, news flash, dumbass! Every customer paying credit gives the merchant more incentive to raise prices to include those merchant fees. Just another example of the brain-dead, selfish "I've got mine, fuck you!" American attitude that continues to grace us today.
I don't respond to AC's.
Funny, you know, I"ve found it entirely possible to pay my monthly credit card bills in full, and never have to pay a cent in interest fees.
And your exactly the kind of person the Credit Card Industry calls a "Deadbeat".
https://www.nationaldebtrelief.com/credit-card-revolver-hacker/
It's not a bad thing, but your not the customer they want as your not making them the profit they want.
MacOS isn't the only operating system.
iOS isn't the only mobile operating system.
That's like complaining that the Tesla OS is only available if you buy a Tesla, and you can only use apps on the Tesla in car dashboard that Tesla has approved. So? Doesn't make Tesla a monopoly, you can always buy a different car.
That's a nice idea in theory, but the credit card companies are betting that your luck will run out at some point when you lose your job or have a medical emergency. At that point, you'll be paying 20% interest on your credit card balance along with all the other people who were too poor or too naive to pay off their balances on time.
Considering the annual profits the credit card companies make, it seems to be a pretty safe bet for them.
But they result in everything costing 3% more, whether you use them or not. We are effectively handing over 3% of our entire economies to credit card companies. Does that sound sane?
Hint: you only pay interest on ANY credit card if you maintain a balance on the account for more than one accrual period. Don't buy more than you can afford, or budget in the interest on a high priced purchase as the cost of credit access.
That's how it works.
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