Apple has unveiled plans to launch a credit card in the US this summer with Goldman Sachs and Mastercard, putting the tech giant in direct competition with traditional banks for the first time.
The Apple Card, unveiled at Apple’s headquarters in California on Monday (25 March), will provide users with a level of spending data familiar to users of digital challenger banks such as Monzo, Starling and Revolut.
Using machine learning and location data, the Wallet app will show users where they have made purchases and how much they have spent on different kinds of items, filing payments into categories such as travel or food and drink.
Apple has sought to establish itself as a pro-privacy company in recent years, distancing the brand from its advertising-funded rivals in Silicon Valley. Privacy and security is a key selling point for Apple Card. The data analysis takes place on the phone, meaning Apple does not know what users bought, where they bought it or how much they paid for it, while Goldman Sachs has committed to never selling on the spending data.
The service also offers users rewards, but rather than using a points-based system, it provides cash back. The system, dubbed Daily Cash, offers two per cent cash back when users make payments through Apple Pay and three per cent when they buy products through Apple.
Users are offered the ability to pay back their debts on a weekly or biweekly basis and are charged no fees relating to late payments or international usage. Apple Pay chief Jennifer Bailey said she wants users to understand “how much you owe and overtime how much it will cost you”.
The news marks one of the most significant incursions yet by an American tech giant into the financial services space, and the service is likely to play a key part in Apple’s efforts to offset its slowing device business.
Apple Card will be rolled out in the US this summer, with users able to sign up in minutes online. But there is no scheduled release date for the UK and it’s not clear if Apple would partner with Goldman Sachs or other banks if it does roll out the service internationally.