The Apple Card and Goldman Sachs partnership is finally coming to an end, with the bank’s executive previously admitting that it wanted to get out of the deal because of the insurmountable financial loss. Regardless, this exit presents an opportunity for one of the U.S. financial firms to partner with the Cupertino giant, and according to the latest report, JPMorgan Chase appears to be the right bet.
JPMorgan Chase had previously declined to join forces with the Apple Card, but things could be different now
Apple’s and Goldman Sachs’ tumultuous relationship presents an opportunity for another U.S. financial service, with Bloomberg’s Mark Gurman stating in his ‘Power On’ newsletter that JPMorgan Chase appears to be the right candidate. However, Chase, American Express, and Citigroup all previously declined to work on the Apple Card, which ultimately led to the partnership with Goldman Sachs.
Sadly, the latter had little experience when it came to consumer products, and it was reported that the bank suffered $1.2 billion in losses in 2022 because of partnering with Apple. There are several reasons why Chase is the ideal partner for the Apple Card, as Gurman has highlighted the following reasons:
“Storing some of the tech company’s roughly $60 billion in cash on hand.
Serving as one of the earliest and most successful Apple Pay partners.
Teaming up with Apple on its Ultimate Rewards program, which offers discounts on Apple devices to its banking and credit card customers.
And, of course, serving as one of the biggest credit card partners for transactions at Apple retail outlets, online store and the App Store.
Chase has something else going for it: It offers credit cards that use the MasterCard network. That’s the same system that powers the Apple Card, meaning there’d be no need to switch to the Visa or American Express platforms.”
However, one area where Apple’s and JPMorgan Chase’s business relationship may not see eye-to-eye is the company’s Apple Card Savings account, which offers a high annual yield of 4.15 percent. Gurman reports that Chase offers a measly return when it comes to interest.
“The one component of Apple’s financial services portfolio that wouldn’t be a fit for Chase is its savings account. That product is touted as a high-yield account, with an annual rate of 4.15%. Unlike Goldman and some other banks, Chase only offers peanuts when it comes to interest for savings accounts. So, assuming Chase won’t get into high-yield accounts to secure a deal with Apple, there will need to be another solution for that product.”
Fortunately, the savings accounts can be split between banks willing to offer a high yield, but that will mean the Apple Card needs to be integrated with two banks instead of one. However, how fruitful these plans will be is anyone’s guess, but as always, we will update our readers on the latest, so stay tuned.
About the author: Omar Sohail is a reporter and analyst for Wccftech's mobile section, specializing in the technology and business of the mobile industry. His expertise lies in the intricate hardware supply chain, covering developments in semiconductor manufacturing, chip lithography, and camera sensor technology.
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