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My understanding is that goldman sachs, who operates the apple card under the hood, is trying to get out of the deal because they lose money on it. I presume t
by william45123 2y ago
My understanding is that goldman sachs, who operates the apple card under the hood, is trying to get out of the deal because they lose money on it.
I presume that the type of person who wants an apple card is strongly negatively correlated with the kind of person from whom they could make lots of money via fees from. I would bet my apple card balance that the percentage of apple card customers who religiously pay off their balance every month is much much higher than industry average.
- stefan_ 2y agoNot to interrupt the "Apple buyer are sophisticated high status individuals" talk but Goldman is losing money on the Apple card precisely because they are lending to people that can't make the payments.
- TheNewsIsHere 2y agoThere were reports (OTOH from late 2023 or early 2024) that GS not being a consumer-facing credit business created a lot of headaches and need for spending. GS did have some other cards before Apple Card, but they were not generally marketed or widely available to the masses like Apple Card. GS wasn’t well prepared for the extra overhead and customer support, and Apple negotiated a _lot_ of power that GS agreed to give them in areas like underwriting decisions. Apple wanted applications approved and many approvals wouldn’t have met with GS’s typical risk tolerance.
- MBCook 2y agoApple also reportedly wanted GS to approve everyone possible and be looser on their standards, which wouldn’t help keep away the worst customers.