Apple has apparently found at least two companies that want to take over some of the tasks for the Apple Card: Both American Express (Amex) and Visa are fighting over adding the iPhone company’s credit card to their network, according to a report in the Wall Street Journal. Apple’s current partner, the banking house Goldman Sachs (GS), has wanted to get out of the long-term contract for several years due to negative business, but this would first require a new partner. GS currently uses MasterCard as the payment network for the Apple Card, which is still only available in the USA.
First payment network, then bank?
According to the Wall Street Journal, Visa is said to be prepared to pay Apple 100 million US dollars to become the payment network for the credit card, which is available directly on the iPhone, Apple Watch and Mac. Amex is also trying to replace MasterCard, it was said. There is a “tough battle” between the networks. However, this does not mean that Apple has found a direct replacement for Goldman Sachs. Apple also needs a new banking partner – or the company will become a bank itself, although it is unclear whether it intends to do so, as a licensing process would then have to be gone through and the internationalization problem has not been solved.
According to the report, Apple first wants to select the network before the new banking partner – whereby Amex is also said to have offered to issue the card directly. In contrast to Visa (and MasterCard), the company can do this because it also acts as an “issuer”, including the necessary banking infrastructure, and often markets its cards directly. GS itself is said to have entered into initial negotiations with Amex – in 2023. However, this did not result in a direct takeover.
Internationalization is still pending
The credit card networks are very interested in the Apple Card, as it promises comparatively high sales. Apple has launched a fairly customer-friendly program with its credit card, so the card lacks the numerous fees of other offers – but the interest rates are still typically high. It is unclear whether the rates would remain the same with a new banking partner. For customers, the Visa network would probably have the best possible starting point with the Apple Card – it is the most widespread worldwide, behind or on a par with MasterCard. Amex, on the other hand, is accepted much less frequently, even though the credit card issuer is also trying to convince smaller merchants with advertising programs.
Possible banks that could replace GS with the Apple Card are JPMorgan Chase and Synchrony Financial, and the major credit card issuer Captal One is also said to have shown interest. Goldman Sachs had promised Apple rapid internationalization, but failed to deliver. Instead, the company incurred losses in the billions.
(bsc)
