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Businesses Apple

Goldman Sachs CEO Says Apple Card is the Most Successful Credit Card Launch Ever (cnbc.com) 101

Posted by msmash from the marching-forward dept.
Goldman Sachs CEO David Solomon called his bank's rollout of the Apple Card "the most successful credit card launch ever." From a report: Solomon provided investors with an update on the bank's new initiatives at the start of a conference call Tuesday. "We believe Apple Card is the most successful credit card launch ever," he said. Continuing on the Apple Card, which the bank built in partnership with the iPhone maker, Solomon said that "since August, we've been pleased to see a high level of consumer demand for the product. From an operational and risk perspective, we've handled the inflows smoothly and without compromising our credit underwriting standards."
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Goldman Sachs CEO Says Apple Card is the Most Successful Credit Card Launch Ever More

Goldman Sachs CEO Says Apple Card is the Most Successful Credit Card Launch Ever

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  • What are they up to? (Score:5, Insightful)

    by monkeyxpress ( 4016725 ) on Wednesday October 16, 2019 @09:58AM (#59314400)

    I have met a few folks who worked at the Goldman Sachs. Goldman Sachs does not hire stupid people. It hires the best of the best, and pays them obscene amounts of money for them to spend every waking hour working towards the singular primal goal of making truck loads of money for Goldman Sachs.

    One wonders then what Goldman Sachs is doing messing around with the annoying world of retail banking. You have to deal with lots of annoying customers, spending comparatively tiny amounts of money. If there is one thing I know for sure, Goldman Sachs aren't doing this because they just want to become the next friendly high street bank on your street corner. They have a bigger goal that they likely see as paradigm shifting, and that goal is unlikely to not be in your interest as a consumer.

    If you doubt any of this read about the Goldman Sachs aluminium market scandal. They literally engineered the manipulation of the entire global aluminium market. That takes some real commitment to making money without any moral considerations.

    • Apple has lots of money. Goldman Sachs wan't lots of money. Be nice and helpful to Apple and you can get some of their lots of money.

    • Re: (Score:3)

      by sinij ( 911942 )
      I think this is play to get in on Apple Pay and whatever it turns out to be in the next interaction. Since VISA/MasterCard duopoly is impossible to challenge directly, this might be a round-about way to get to the table.

      • I think this is play to get in on Apple Pay and whatever it turns out to be in the next interaction. Since VISA/MasterCard duopoly is impossible to challenge directly, this might be a round-about way to get to the table.

        Apple card IS a MasterCard.

        • So they just piggybacked onto an already successfully established entity? I guess that would be counted as success then. Headline makes it sound like they are competing against the establishment with something all new.
          • apple hasn't done anything new in since... forever.

            • Re: (Score:3, Informative)

              by cayenne8 ( 626475 )

              apple hasn't done anything new in since... forever.

              But, as Apple often does...they take something that is out there and improve on it.

              The CC experience has been greatly improved upon with the AC.

              The instant cash back is nice.

              It is really handy to have your CC info at your hand whenever YOU have time or the want to check it..shows your charges, what you owe, tracking purchase types, etc.

              Having the handy does seem to make it easier to see how on track you are with your monthly budget on a constant basis,

              • I haven't used Apple Card. How is that different from just using your bank's mobile app to view your latest transactions? With the Chase app and others you can even sign in with your Touch ID / fingerprint.

                • There is no difference. If you've had your head stuck in the Apple ecosystem, then Apple introduces widespread features/services it seems revolutionary. Other consumers are left with the emptiness of feeling "meh" about this amazing Apple development that was "not designed by a bank."
                • The difference is credit card transactionâ(TM)s usually donâ(TM)t appear instantly, they often take many days. On apple card itâ(TM)s instant.
                  • Huh? I have a trigger set on my mastercard for a text to be sent anytime greater than X dollars are charged. It dings when I run the thing at the register. The trigger is set high enough that I always forget until I buy something substantial.

                • Everything you need to do is integrated into the wallet app, from purchasing to to managing receipts to payment to rewards. No extra app to launch, no extra password. I might check my Chase app weekly, but the Apple Card I see with every transaction— multiple times per day.

          • Re: (Score:2)

            by jbengt ( 874751 )
            Master Card and Visa do not hold your credit card debt, they never have. They are just processing services to the banks that do hold the debt. (notice the logos on each card, like Bank of America or Chase) This is in contrast to Discover Card, and a few other cards, that do own the debt (at least through a bank that they own).
            It will be fairly simple for Goldman Sachs to enter retail banking this way, they just float some money and pocket the interest and fess from the consumers and merchants, minus the

        • Today.

          But, having the Apple Card means they have your bank account number, and give you “Apple Cash”, potentially getting you into that ecosystem as well.

          As for what GS gets out of it, I think it is a dead-simple credit card program with near-zero human interaction, very low default risk, and market leading automation. They also get substantial initial transaction volume driven by the way Apple positioned it.

          There are only a handful of things I dislike about my card, but I can imagine 90% of use

          • Re: (Score:2)

            by mbkennel ( 97636 )
            The other aspect: if Goldman didn't take Apple's deal, Chase or Cap1 probably would, and they'd really hate that.

    • That could be their slogan. : Committed to making truckloads of money without any moral considerations!
      You don't have to be a psychopath to be part of a psychopathic ideology.

    • Ex-employees say profit is not enough. It has to hurt the other side too.

    • Helping leverage Apple's semi-monopoly in existing markets and making as much money as Apple lets them get away with. Apple doesn't hire anyone who would taint their trillion dollar brand, they hire even smarter people. Goldman Sachs is a the weak partner in this.

      Credit cards are an oligopoly with mad profits but a high barrier to entry due to needing massive scale to make all the necessary international agreements with banks. Apple has scale and a captured audience, they needed some know-how and banking co

    • Not just aluminium. (Score:4, Insightful)

      by BAReFO0t ( 6240524 ) on Wednesday October 16, 2019 @10:20AM (#59314498)

      They also buy the entire world harvest of some essential thing like beans, and let it get old in some warehouses.for several *months*, until people are literally starving and willing to pay crazy prices they can't sustainanbly afford.

      That is *crazy* James Bond villain evil!
      Except it's real life, and not some "crazy conspicacy theory". --.--

    • Re: (Score:2)

      by DarkOx ( 621550 )

      One wonders then what Goldman Sachs is doing messing around with the annoying world of retail banking

      From what I can tell they are not. They are for the most part letting Apple do all the hard work of marketing the product, developing the consumer facing materials, etc. Goldman is (1) "being a licensed bank" already so Apple does not have deal with the regulators. (2) Performing accounting functions they mostly already have systems to handle.

      (3) Taking a cut of a pretty good revenue stream without that much risk really attached to it. Remember we are talking about a self selected clientele here that is

    • There is a few reasons for Goldman Sachs to be doing this.
      1. Customer Diversity having a few big customers vs a lot of little customers offers a hedge on risk. If one of your big customers drop, the company can go south quickly. However smaller customers can drop and join and it being a smaller impact per customer.
      2. Public Relations. Offering a popular product to the public, in general keeps their PR above what their actual business practices deserve.
      3. Keeps the door open with one of the worlds biggest c

      • There is a few reasons for Goldman Sachs to be doing this.
        1. Customer Diversity having a few big customers vs a lot of little customers offers a hedge on risk. If one of your big customers drop, the company can go south quickly. However smaller customers can drop and join and it being a smaller impact per customer.
        2. Public Relations. Offering a popular product to the public, in general keeps their PR above what their actual business practices deserve.
        3. Keeps the door open with one of the worlds biggest company. No matter what size pond you are in Apple is the big fish. If it wasn't Goldman Sachs, Apple would go with someone else. Then their competitors would be having the weekly status meetings with Apple. If you can get your foot in the door, and Apple may want a billion dollar loan, having an established relationship is a big advantage.

        Your missing the obvious. Credit cards are highly lucrative. Say you have 10 million accounts out there , even if only a fraction of those accounts carry a balance you are basically printing money.

    • Re: (Score:2)

      by nagora ( 177841 )

      I have met a few folks who worked at the Goldman Sachs. Goldman Sachs does not hire stupid people. It hires the best of the best,

      The Great Myth of Goldman Sachs. They still nearly went to the wall in 2008.

      Someone has to be top-dog; it's largely luck which of the greedy bastards it actually is after any given crisis and of course that leaves them dominant until the next crash, which is usually caused by them believing the Great Myth that the rich are rich because they're better.

      • They got bailed out. They all got huge bonuses that year. Why wouldnâ(TM)t they? They literally got government to give them free money and take there bad debt. One is there best year ever.

    • Re: (Score:2)

      by pz ( 113803 )

      It is not unusual for a large company to spawn a finance arm. And in many cases, these finance arms end up earning more money for the firm than the original product or service. GE Financial. Ford Motor Credit Company. IBM Global Financing. HP Financial Services. And nearly all of the Fortune 500 companies issue a branded credit card. Apple is late to the game.

      But for GS, the play is clear: make tons of profit on a heapload of people who have lots of disposable income and a penchant for anything that

    • If by "very smart" you mean "barely avoided bankruptcy and required taxpayer bailout in 2008" then I agree.

    • One wonders then what Goldman Sachs is doing messing around with the annoying world of retail banking. You have to deal with lots of annoying customers, spending comparatively tiny amounts of money. If there is one thing I know for sure, Goldman Sachs aren't doing this because they just want to become the next friendly high street bank on your street corner.

      They are now a card issuer. With Apple. For rabid Apple fans, who love to spend money using Apple products. It is a new market for them, but they precisely DON'T have to deal with the gory details of retail banking. It aligns pretty well with their other businesses, and what they do best - make money.

    • One wonders then what Goldman Sachs is doing messing around with the annoying world of retail banking.

      Right now, what they are doing, is losing a lot of that immorally earnedmoney.

    • Re: (Score:2)

      by mbkennel ( 97636 )
      "One wonders then what Goldman Sachs is doing messing around with the annoying world of retail banking."

      Automation and hedge funds & regulation are reducing trading & security sales profits. Higher capital requirements being imposed for tail risk. High rogue trader and cybersecurity risk that can drain millions in an instant.

      Retail banking is a more consistent fee-based business.

      And their biggest capable competitor is JPM, both the biggest investment bank JP Morgan and biggest retail/commercial ba
    • Goldman Sachs didn't used to issue credit cards. At all. If there was anything out there with their name on it, it wasn't made by them, it was just them selling their brand name.

      The Apple Card is actually issued by them. They are now a card issuer through and through. That's why launching it was so expensive. They didn't just slap an Apple logo on their existing cards, they built the infrastructure to actually issue their own cards that they own 100%. They partnered with Apple for the press.

      As for w

    • This time, it's not aluminum, it's titanium they are after!

  • At $1100 per year or whatever it is to keep up with the Apple Joneses, you don't need an Apple credit card, you need an Apple Mortgage.

    • ...when I run, it's an iPod, talk, it's an iPhone
      stuff I gotta have no matter what, it's an iLoan...

      Well, that was back in 2007 but with inflation we're probably at an iMortgage by now.

    • Re:You need one just to buy a phone (Score:4, Insightful)

      by phalse phace ( 454635 ) on Wednesday October 16, 2019 @11:22AM (#59314818)

      At $1100 per year or whatever it is to keep up with the Apple Joneses, you don't need an Apple credit card, you need an Apple Mortgage.

      Apple has always offered a lower priced iPhone (iPhone 8 starts at $449) along side their flagship iPhone.

      So not only do you not need to spend $1,100 to get an iPhone, you don't even need to spend $1,100 per year because most people don't upgrade every year and starting price for their flagship iPhone 11 Pro is $999.

      • Hey, don't get in the way of a good rant.

        I heard that Google is about to introduce Android Card, which for your convenience has malware pre-installed.

    • Yeah....been the same Apple laptop, the only one I own, since 2012.

    • At $1100 per year or whatever it is to keep up with the Apple Joneses, you don't need an Apple credit card, you need an Apple Mortgage.

      That's $91.66/mo. Which is about what a high-end cable TV package costs, or roughly about what it costs if you got a Starbucks "venti" sized coffee every weekday morning.

      It's still less than a pack-a-day smoking habit. Most people don't need a new iPhone every year, but there's worse things to spend your money on.

      • At $1100 per year or whatever it is to keep up with the Apple Joneses, you don't need an Apple credit card, you need an Apple Mortgage.

        That's $91.66/mo. Which is about what a high-end cable TV package costs, or roughly about what it costs if you got a Starbucks "venti" sized coffee every weekday morning.

        It's still less than a pack-a-day smoking habit. Most people don't need a new iPhone every year, but there's worse things to spend your money on.

        I agree that all these expenses are equally stupid unless you are rich enough not to care. If you do have a finite income, drink your own coffee, don't buy Apple products, and pay at least half that amount for TV. And definitely don't smoke.

  • It means: Made HIM the most money, and harmed others the most too.
    (According to internal sources, the policy at "Gold ManSacks" is that profit is not enough. The competitor must be hurt too!)

    And e.g. the bailout was "successful" to him too. As was the crashing housing market, before they found out the had unknowingly eaten their own dog shit.

    So yeah... it likely means: More poverty and inequality for us.

  • I don't buy Apple products and I already have a 2% cash back on everything card with no fees, and the 2% actually works with the card, not using Apple Pay. No thanks.

  • "The most successful launch of a motor vehicle in history" Edsel Ford, CEO and Founder of Edsel Ford. Color me skeptical when guy claims his own company did the best thing ever. What was he going to say? "Sorry, could have been a great thing, but we effed it up royally."

  • The card is a regular MasterCard just like any other, but is objectively worst than many competitors (lower cash return, less perks). But it has an Apple logo on it!
    Who would have thought it would become a success with Apple fans?

    • But it has an Apple logo on it!

      You may be missing the point. You don't even NEED the "card". Therefore, having a "card" with a logo on it is completely irrelevant.

      I have the "Apple Card", but it exists only on the phone. Nothing in my wallet. I have the Citi Costco Visa card for that purpose. Nothing too glamorous about it either.

      • And as an aside...when I use it to pay via Apple Pay, no one has any fucking clue I'm using the Apple Card rather than some other credit card either.

        So much for the "status" argument.

      • Why do you need two credit cards instead of one?

        • Re: (Score:2)

          by _merlin ( 160982 )

          I'm not that guy, but I have two cards: an AmEx and a Visa. There are places that don't accept AmEx, or charge a higher fee for using it. Also the Visa gives better foreign currency conversion rates on things other than USD.

          • I understand some cards are better for some purposes. But I don't see any advantage of the Apple card. You get 3% on Apple purchases, but there is no extra warranty (which I consider very important on computers and phones). Maybe if you buy a lot of music and software from Apple. But you have to purchase a lot for that extra ~1% to be worth it considering the burden of signing up and having the card (which must also affect credit score).

      • You may be missing the point. You don't even NEED the "card". Therefore, having a "card" with a logo on it is completely irrelevant.

        If it were completely irrelevant they wouldn't have gone to the trouble of producing one.

    • And it's made of titanium. It feels really nice in the hand.

      "That's bone, lettering is called Silian Rail."
      "Eggshell with Romalian type"
      "Raised lettering, pale nimbus white"
      "Look at that subtle off-white coloring. The tasteful thickness of it, even has a watermark..."

      https://www.youtube.com/watch?... [youtube.com]

    • They're approving people with sub-prime credit scores, which doesn't always mean "deadbeats". Some of us are finally trying to rebuild credit from the great recession, and the Apple card is at least a real credit card.

      Yes, I do realize the irony of GS being one of the contributors towards the great recession, and now they're profiting from the results...

  • All these cash back cards do is increase the price of goods and services. Merchants already pay a fee to accept your card payment (numerous sites indicate these average around 2.65% of the transaction). That means they have to increase the amount of their goods to account for this and still earn the same margin. Rewards cards generally have an even higher fee (some sites claim as high as 5%). This is how you get those rewards. The bank charges the merchant, say 3.65% and gives you 1% back. Here's the

    • Honestly, it would be nice if the model was that consumers pay for whatever fees are associated with their method of payment.

      Absolutely. Credit cards are the biggest and most successful financial scam of all time. Give the benefits to the people using the card, bill somebody else for those benefits. It's all bullshit. But, since so many people (especially Americans) are only about "gimmie, gimmie, gimme", it works really, really well.

      • Give the benefits to the people using the card, bill somebody else for those benefits.

        If you can't beat 'em, join 'em. There's nothing stopping you from getting a credit card and just paying it off in full every month. You get the cash back benefits (basically, getting the amount you've been "overcharged" to make up for processing fees, returned to you), and won't pay any interest.

        Just because most Americans use credit cards irresponsibly doesn't mean it's not possible to use one without it leading to financial ruin.

      • This is the kind of oligopoly (Mastercard/Visa/Amex) situation where a government intervention is needed. Just like they did in Australia, by lowering the fee charged by credit cards corporations to merchants.

        The problem is not going to be solved by altruist people stopping using their credit cards.

    • Not sure it works this way, I'm involved in retail, and our markup is standard for the product itself..and not all purchases are made with CC, so that would mean people not using a CC are paying more? We have a standard contract with the payment terminal, and it's a fixed rate for each CC company (VISA, Mastercard, etc). It doesn't change if they're using different versions of Mastercard.

      My guess is the 'rewards' are paid by the CC company, they may offer 2% cash back, but giveng their interest rates and ho

  • "We believe Apple Card is the most successful credit card launch ever," he said. This sounds like somebody Donald Trump would quote in tweets.

  • With an interest rate of 13%-16%, I think I will be happier without, It needs way below 10%. But then again, I am not used to the whole concept of "rewards" credit cards and I like to pay it in full every month. Also, apparently you shouldn't carry it in a leather wallet. %-)
    And Goldman Sachs is in involved, so that alone is a no thanks from here.

    • But then again, I am not used to the whole concept of "rewards" credit cards

      then you are paying about 2% too much on everything except maybe your car and housing.

  • Fucking Goldman Sachs slimeballs, figures they'd be sucking Apple's collective dick.

  • For everything except their credit card launch figures, do you really trust them when they say their credit card launch has been "teh bestest"! ?

    This seems to be an ongoing trend of statments backed by no verifiable fact. Sorry but we don't need to take this at face value. We don't need to believe Goldman Sachs had the most successful credit card launch (whatever that means since it wasn't defined). We don't need to believe Take 2's CEO that Borderlands 3 is the best selling game they ever had (when the gam

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