Payments: An Apple–Goldman Sachs credit card
“Apple and Goldman Sachs want a piece of your wallet,” said Maria LaMagna in MarketWatch.com. The technology giant and the blue-chip investment bank are teaming up to create a joint credit card that could be introduced as early as next year. Although details on terms and perks are still being hashed out, the card will likely be branded with Apple Pay, Apple’s mobile payment and digital wallet platform. Consumers who spend on Apple products will reportedly receive extra rewards, and Goldman is said to be considering in-store loans to Apple customers buying iPhones and other devices. The move “could address priorities for both companies,” said Hugh Son in CNBC.com. Apple is hoping to boost revenue “from things other than gadgets,” while Goldman has been pushing more aggressively into consumer banking, after launching a retail banking business called Marcus in 2016 for online savings accounts and personal loans.
At first glance, Goldman and Apple “make an unlikely team,” said Aaron Pressman and Adam Lashinsky in Fortune.com. But this partnership “is a story of reinvention for both.” For Apple, pursuing a bigger chunk of the mobile-payments business is “part of its services story,” in which it’s trying to move beyond selling only hardware. A physical credit card would vastly extend the reach of Apple Pay, since the plastic could be used in places that don’t yet accept digital payments. And that means more revenue: When consumers use Apple Pay now, Apple receives 0.15 percent of every transaction. The deal with Goldman could give it an even larger cut. Goldman, too, is in the midst of a major shift. After the financial crisis, “it became a bank, in part because regulators forced it to,” and it’s betting big on offering more products to Main Street. Even if these companies aren’t obvious partners, right now they share “a clearly demonstrated appetite for change.”
Still, Goldman’s “first foray into plastic” promises to be at least a little fraught, said Tripp Mickle and Liz Hoffman in The Wall Street Journal. Its experience with consumer finance is “scarcely two years old,” and the credit-card market is a “cutthroat business” dominated by larger rivals such as JPMorgan Chase and Citigroup. But Goldman knows it needs to look somewhere for new profits; since the financial crisis, its revenue from securities trading has fallen by two-thirds. And if a tie-up with Apple can offer anything, it is access to “a devoted customer base teeming with wealthy, well-traveled young adults,” said Emily Flitter and Jack Nicas in The New York Times. This jointly branded card could help Goldman insert itself into the lives of millions of iPhone users. From there, it will be far easier to entice them with “the other services the bank has to offer.”