What do they gain from offering the card if they are not harvesting transaction data? Is it possible that this is some legal gymnastics (i.e. Goldman-Sachs receives the 'Apple doesn't know' data and promptly send it over to them under an opaque 'we share information with our affiliates' clause)?
It does seem like a lot of work and potential risk if the sole purpose is to increase user dependency on the Apple ecosystem.
They get a percentage of every transaction (small, but it is about the aggregate for them). Mostly for Apple this is about pushing people who are using ApplePay to back it with a credit card that Apple gets a piece of, rather than the one you already have a piece of. So they get the small chunk from being in the loop with ApplePay, and now a small chunk from being the sponsor of the card.
Apple has been very focused on not being a big-data company. Any sort of back-end shenanigans would be so damaging to the brand of information safety that they have been building as to be unworth any potential profit.
It's a foot in in the global financing system. Billion people buy their products, and given their price, I'm ready to bet that the number of people who finance their purchase instead of buying with cash is not insignificant. That's lots of interest payments.
Once they have a foothold in the finance sector they can start financing their own devices and capture that revenue, instead of letting it slip to third parties.
This makes incredible sense. Lots of large companies have financing services that are very profitable. Finance is one place where it's much easier to enter than self driving cars.
Now I'm a bit sad I don't own any apple stocks.
With this game plan they can increase their leverage in the consumer market enormously.
Apple has/had a deal with Barclays for financing purchases from the Apple store. They still have to cut Goldman in on the new card, so not really sure how much better it is for them on financing Apple purchases.
I believe this whole thing is designed to promote adoption of Apple Pay. Apple already gets a kickback on all Apple Pay purchases, so they don't even need to get any kickback on physical card purchases when the higher rewards for Apple Pay means card owners will push for better Apple Pay support.
Previously with other cards, using Apple Pay is just a matter of convenience for the customer. With the Apple Card, it's a matter of getting more cash back, so consumers are now financially motivated to prefer vendors that support Apple Pay.
Apple likely save quite a lot from small transaction ( $0.99 ) if it was done on Apple Card.
Roughly $50B are spent on App Store, and even more with growing number of Subscription along with other Apple Credit Card usage. That is a potential of $100B+ transaction volume.
It will likely be another entry point for Apple Cash, sending and receiving money from friends.
They save merchant fees when the card is used on their products, and collect them when the card is used elsewhere. Same reason your bank issues a card, really. Though mastercard's still the payment processor here.
Usually a percentage of each transaction and/or flat fee per cardholder or signup and/or a percentage of fees and interest paid. The exact details on these agreements are rarely published.
Agree that health skepticism is warranted here but it might also be that they are trying to re-think the credit card experience to improve it for everybody.
It does seem like a lot of work and potential risk if the sole purpose is to increase user dependency on the Apple ecosystem.