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This is interesting to observe from the UK. - Cashback is generally lower here because interchange fees are regulated/capped to 0.3% for personal credit cards
by lol768 8y ago
This is interesting to observe from the UK.
- Cashback is generally lower here because interchange fees are regulated/capped to 0.3% for personal credit cards and 0.2% for personal debit cards. Offers of 2% cashback simply won't work outside the US so I'll be curious to see how (if?) they try and expand this globally.
- "All of the spending tracking and other information is stored directly on the device, not Apple’s servers" - can't see how this will work in practice. If you lose your phone, do you lose information on historical purchases? What if you want them for your records? Perhaps "spending tracking" just refers to data derived from the transaction information... but then, couldn't you just recompute it?
- "Apple also says that it’ll use machine learning and Apple Maps to label stores that you use in the app, and use that data to track purchases across categories like “food and drink” or “shopping.” " - I guess this is novel in the United States, but challenger banks like Monzo/Starling have been doing this for a number of years.
- "Customers will also be able to track purchases, check balances, and see when their bill is due right from the app." - not novel, CC providers like Amex and banks like Monzo already do all of this, including push notifications.
- "To get an Apple Card, users will be able to sign up on their iPhone in the Apple Wallet app and get a digital card that they can use anywhere Apple Pay is accepted “within minutes.”" - again, not novel. If you sign up for a Monzo account, the KYC checks are done reasonably quickly (certainly same-day IME) and then your account is open. You can add it to Android Pay (https://monzo.com/blog/2018/11/19/instant-google-pay/ https://monzo.com/blog/2018/11/19/instant-google-pay/) and make payments, bank transfer money in instantly etc.
Overall, I'm a little perplexed as to why this offering is interesting besides Apple having announced it.
- dharma1 8y agoNew for the US
- lol768 8y agoDon't you have Simple Bank?
- dogma1138 8y agoI get 2-5% cash back on my American Express Platinum card in the UK... There are higher cash back cards also the cash back is usually capped on a monthly basis rather than on a flat %. So far for this year I have £341.92 cash back on the card. Mind you that this isn’t a new card I had it for 5 years.
- gsnedders 8y agoAmex's own-branded cards aren't subject to the interchange limits, because they're vertically integrated (and there's no interchange).
- dogma1138 8y agoAnd what exactly would prevent Apple from using the same scheme in the UK and Europe at large?
- gsnedders 8y agoNothing, except that then their card would have 0% acceptance. Much harder sell to get people to get the card if no merchants accepts it, and harder to get merchants to take it if nobody has one. There's a reason why the credit card market is almost entirely American Express, MasterCard, and Visa. If they wanted to pay higher cashback than the standard interchange rates allow, they'd be charging merchants more than they're charged for accepting MasterCard or Visa, which means you'll end up with at most spotty acceptance like American Express.
- dogma1138 8y agoAt least in London I've only seen a handful of places that don't take Amex, and as of today I can think of only one a coffee shop I sometimes use.
- Cu3PO42 8y agoIn Germany the acceptance for credit cards only became large scale after the interchange fee was limited. Today, most stores that accept card payments also accept credit cards, but only MasterCard and Visa. Using an AMEX as your primary card would be a pretty bad experience, because you'd constantly need a backup. With that said, I'm happy most merchants don't put up with the humongous fees—in the end the prices are just raised to compensate for them.
- davb 8y ago> "Apple also says that it’ll use machine learning and Apple Maps to label stores that you use in the app, and use that data to track purchases across categories like “food and drink” or “shopping.” " - I guess this is novel in the United States, but challenger banks like Monzo/Starling have been doing this for a number of years. And even then, I don't think any machine learning is needed here. Monzo use the Merchant Category Code (https://en.m.wikipedia.org/wiki/Merchant_category_code https://en.m.wikipedia.org/wiki/Merchant_category_code) to categorise purchases and public/commercial data sources like Google, Twitter and Foursquare (see https://community.monzo.com/t/where-does-monzo-get-its-icon-images/8385 https://community.monzo.com/t/where-does-monzo-get-its-icon-...) to get merchant locations, "friendly" names and logos.
- RandallBrown 8y agoI think the novel thing here is that Apple won't actually have any idea who/where you're purchasing from, but will still be able to display data on your phone like they do.
- nemothekid 8y ago>- "All of the spending tracking and other information is stored directly on the device, not Apple’s servers" - can't see how this will work in practice. If you lose your phone, do you lose information on historical purchases? What if you want them for your records? Perhaps "spending tracking" just refers to data derived from the transaction information... but then, couldn't you just recompute it? You can back up your device to your computer (which Apple cannot access) or to iCloud (which Apple can access). If you lose your device, just restore from a backup.
- oliyoung 8y ago> Cashback is generally lower here because interchange fees are regulated/capped to 0.3% for personal credit cards and 0.2% for personal debit cards. Offers of 2% cashback simply won't work outside the US so I'll be curious to see how (if?) they try and expand this globally. This is also the reason that the bigger banks in Australia dragged their feet on ApplePay, there's little to no margin on those fees that Apple taking more made it untenable for them to support it here, until they did.
- baby 8y agoFrom a UK perspective this card doesn’t make much sense as Monzo or Revolut are probably way better products. For the US there is pretty much zero competitors as banks are stuck in the past. As for storing transactions on device only, there’s probably an encrypted backup on iCloud.
- hyperbovine 8y ago> Overall, I'm a little perplexed as to why this offering is interesting besides Apple having announced it. But that’s just it. Scratch another thing off my list of stuff — wireless charger, e-reader, television, car — that I’m waiting for Apple to come along and Get Right.
- ebg13 8y ago> - Cashback is generally lower here because interchange fees are regulated/capped to 0.3% for personal credit cards and 0.2% for personal debit cards. Offers of 2% cashback simply won't work outside the US so I'll be curious to see how (if?) they try and expand this globally. How does that work for US-based cards used outside of the US? I definitely don't lose my rebate while in other countries.
- foepys 8y agoThe bank/CC provider most likely just eats it and blocks your card when you are overdoing it. The losses are very likely negligible for the average consumer that is outside of the US maybe once in their life.
- baud147258 8y ago> "Apple also says that it’ll use machine learning and Apple Maps to label stores that you use in the app, and use that data to track purchases across categories like “food and drink” or “shopping.” " - I guess this is novel in the United States, but challenger banks like Monzo/Starling have been doing this for a number of years. I've got the same services with BNP in France. I don't know how the data is computed/retrieved, though; maybe it's coming from manual tagging by users (since user can tag each individual payement).
- Tsiklon 8y agoI suppose when it comes to opening a line of credit - being able to sign up and have everything approved and ready to go in minutes (at a reasonable interest rate) is the differentiator here. The products offered by Revolut, Monzo et al are debit accounts, when you open an account with them you're not opening a new line of credit. With a debit account I assume on the whole the level of risk which the bank takes on is significantly less than opening a new line of credit. As for the features you mention I concur - these are all well established here in the UK.