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The interest rate on this is zero: > Apple Pay users can split purchases into four payments with zero interest and no fees

raincole 4y ago
It sounds suspicious tho. So who takes the risk?
- gnicholas 4y ago
  You think Apple is lying about this? Or you think that they are hoping that you miss payments and then they (a three trillion dollar company) are going to make a material amount of money on an interest penalty?
  - raincole 4y ago
    > You think Apple is lying about this? No of course not. I'm not saying Apple is lying. > Or you think that they are hoping that you miss payments and then they (a three trillion dollar company) are going to make a material amount of money on an interest penalty? Maybe? I don't know how much banks make from this kind of thing. That "(a three trillion dollar company)" comment is so irrelevant that it's almost laughable tho. Banks are huge companies too, and they still make money from interest.
    - gnicholas 4y ago
      Yes, banks are large precisely because they make money this way. The point is that Apple makes huge amounts of money by selling tech products and services, and by having a loyal following. It would be surprising if they decided to trade some of that goodwill for a relatively (in their world) amount of cash.
- simonswords82 4y ago
  Miss one of those interest free payments and I suspect it gets expensive very quickly.
- BirAdam 4y ago
  Essentially, Apple. Goldman is getting their pay in transaction fees. Apple is hoping to increase the number of purchases made on Apple's products. You get cash back on each transaction, Goldman gets a percentage of each transaction, Apple just loses a tiny bit of their profit on the sale, but they still made the sale. The only issue then is that debt collection is more expensive. The truth, however, is that most people pay their debts.
kimbernator 4y ago
If you have impulse control and can properly conceptualize a loan, it could be a useful tool. In my experience, however, these kinds of programs don't target responsible spenders. People are pretty bad at thinking about monthly cost in terms of total cost.
- gnicholas 4y ago
  Totally agree that it's best for responsible people. But what is Apple's goal here — to increase the number of people/merchants using Apple Pay or hitting people with unexpected interest payments, which would sour them on the Apple brand? I would think that they're trying to grow their ecosystem, rather than make money while alienating customers. I could be wrong though — when times are tough, even good companies do lousy things.
  - kimbernator 4y ago
    I don't really think Apple's interest is in collecting interest on these payments, but I do think it will cause people to use Apple Pay more because it enables (perhaps encourages) them to buy things they otherwise wouldn't buy. That can be good or bad depending on the circumstances, I just expect this will be frequently utilized in an "impulse buy" sort of way because it creates an illusion of affordability.

raincole 4y ago

It sounds suspicious tho. So who takes the risk?

gnicholas 4y ago
You think Apple is lying about this? Or you think that they are hoping that you miss payments and then they (a three trillion dollar company) are going to make a material amount of money on an interest penalty?
- raincole 4y ago
  > You think Apple is lying about this? No of course not. I'm not saying Apple is lying. > Or you think that they are hoping that you miss payments and then they (a three trillion dollar company) are going to make a material amount of money on an interest penalty? Maybe? I don't know how much banks make from this kind of thing. That "(a three trillion dollar company)" comment is so irrelevant that it's almost laughable tho. Banks are huge companies too, and they still make money from interest.
  - gnicholas 4y ago
    Yes, banks are large precisely because they make money this way. The point is that Apple makes huge amounts of money by selling tech products and services, and by having a loyal following. It would be surprising if they decided to trade some of that goodwill for a relatively (in their world) amount of cash.
simonswords82 4y ago
Miss one of those interest free payments and I suspect it gets expensive very quickly.
BirAdam 4y ago
Essentially, Apple. Goldman is getting their pay in transaction fees. Apple is hoping to increase the number of purchases made on Apple's products. You get cash back on each transaction, Goldman gets a percentage of each transaction, Apple just loses a tiny bit of their profit on the sale, but they still made the sale. The only issue then is that debt collection is more expensive. The truth, however, is that most people pay their debts.

kimbernator 4y ago

If you have impulse control and can properly conceptualize a loan, it could be a useful tool. In my experience, however, these kinds of programs don't target responsible spenders. People are pretty bad at thinking about monthly cost in terms of total cost.

gnicholas 4y ago
Totally agree that it's best for responsible people. But what is Apple's goal here — to increase the number of people/merchants using Apple Pay or hitting people with unexpected interest payments, which would sour them on the Apple brand? I would think that they're trying to grow their ecosystem, rather than make money while alienating customers. I could be wrong though — when times are tough, even good companies do lousy things.
- kimbernator 4y ago
  I don't really think Apple's interest is in collecting interest on these payments, but I do think it will cause people to use Apple Pay more because it enables (perhaps encourages) them to buy things they otherwise wouldn't buy. That can be good or bad depending on the circumstances, I just expect this will be frequently utilized in an "impulse buy" sort of way because it creates an illusion of affordability.