Apple wants all your money for its latest product. At its WWDC 2019 presentation, the company is introducing the Apple Card as a way to “help customers lead a healthier financial life,” thanks largely to the app’s intuitive interface, zero fees and a unique new payment structure.
The Apple Card, released in partnership with Goldman Sachs, truly gives consumers more control and insight into their spending. But it’s also another way to keep users in the Apple ecosystem surrounded by a barbed wire wall, how can you switch to Android for example if you have thousands of dollars in your Apple Card?
The benefits for Apple are clear, but there are potential benefits for users as well. More and more people are paying attention to the convenience of mobile wallets, and replacing your credit card with an iPhone seems like a natural evolution. Apple’s promises of transparency, privacy and security are alluring, and it’s encouraging to see the tech titanium take over an industry that has historically taken advantage of consumer confusion. But before you get too excited or upset about the new Map, there are several important issues to discuss.
- So what is an Apple Card and how do you get one?
- What about these cashback offers?
- What happens if I lose my Apple Card or iPhone?
- How Apple Helps Lead a healthier financial life?
- What about security and the privacy of Apple Pay transactions?
- Although this does not mean that they will not use your data themselves or for other purposes.
- Who can benefit from Apple Card?
- The transformation of a tech giant into a bankruptcy structure
So what is an Apple Card and how do you get one?
Basically, it’s a credit card. But it differs from regular cards in that you don’t need a piece of plastic before you can use it. You can sign up from your iPhone, get approved within minutes, and use it immediately with Apple Pay. The company will send you a physical card (which Apple makes out of titanium!) For when you need it, like buying a beer at a bar or paying for a merchant who doesn’t accept Apple Pay. You can get it for free and it will arrive by mail within two days. But this is for the USA.
This significantly reduces the waiting time for approval and access to your loan that you want to take. Apple also promised not to charge late fees or international transaction fees, or even set a minimum payment. Interest rates are assumed to be lower than other cashback cards, ranging from 13.24 to 24.24 percent per annum (current rates are set by the Fed) and are determined by your creditworthiness.
“Of course, sooner or later, the global consolidation of the banking sector, following the example of a taxi, will certainly take place. But launching a banking product in a new market is an incredibly difficult project. Each country has its own procedure for obtaining banking licenses.
What about these cashback offers?
Compared to existing cards from competitors, Apple’s rewards and cashback offerings haunt many. Sure, the 3% cashback on Apple products is higher than the market average, but Apple severely limits you on where you can make money.
“These rates won’t lure customers away from competing products like Citi Double Cash, which ultimately offers a 2% return on every purchase,” says Zach Honig, editor-in-chief of The Points Guy.
What’s really nice about Apple’s Cash program is that you can (mostly) immediately use that money that you get back. Bonuses are collected on a bank card and you can get them through your bank account or use them on things like apps, songs, movies and online purchases, or even transfer them to friends. Bonuses are credited to the card on a daily basis, so you can use the money instantly, instead of waiting for weeks to spend what you earn.
There is also no limit on the amount of daily cash you can save or pay with it.
What happens if I lose my Apple Card or iPhone?
Since the titanium card does not include your card number, expiration date or signature, it will be more difficult to steal your information. But since all you have is your name, anyone with your card can potentially take it and start spending. You must act quickly to block your card when you realize that you do not have one, in order to prevent an attacker from accumulating large debts for you. If you’ve only temporarily lost your card, you can unlock it after you find it.
Compared to a traditional card, this is more convenient than calling your bank to block it. But service providers like Capital One have already made it easier to track their cards and suspend an account.
If you lose your iPhone, you will need to go to your computer and sign in to iCloud to find it. The good news is that Apple Pay transactions will still require your face ID or fingerprint authentication, but payments using a physical card will not. It’s also nice that when you buy a replacement phone, all you have to do is sign in to your Apple account and your card information will be automatically restored as well.
BUT THIS IS VERY WEIRD!
So, as Apple said at its presentation that all transactions and payment data will be stored ONLY on a mobile device, and not on the Company’s servers …
How Apple Helps Lead a healthier financial life?
The most attractive feature of Apple Card is its handy toolbar. Apple said it will use on-device machine learning and GPS information to identify and categorize your transactions. She will also colorize your spending and use charts to show you where you put the most money.
This is not an innovation. There are many services available to track your spending and determine your habits, of which Mint is the most famous. But at first glance, Apple’s interface looks easier to use and understand.
Having all this information does not change your behavior in general. As is the case with Apple and Google’s digital welfare services, which show how much time you spend on certain apps. It’s entirely up to you to control how much money you spend drinking in bars, but at least you will have detailed data on your spending.
Another way Apple claims it helps you make better financial decisions is through making your payments easier to understand. Since there are no late fees, finance experts are concerned that nothing is stopping people from borrowing money for their debts forever. The only thing that scares you to pay on time is that the longer you pull money, the more you owe.
The Apple Card dashboard should clearly explain the concept. It is suggested that a small increase in your monthly payments can lower your overall interest with an interactive animated wheel. When you need help figuring out how much you should pay, you can write or call support, which is pretty convenient.
However, one thing remains unclear, as Apple has not set a time limit for how long you have to pay off the loan without any payments, in theory you can do without paying off your debt at all.
What about security and the privacy of Apple Pay transactions?
It should be clear to everyone by now that all of our credit card purchases are being used to target ads to us. But Apple and Goldman Sachs have said they will not sell your information for advertising or marketing purposes.
Although this does not mean that they will not use your data themselves or for other purposes.
When it comes to payment security, Apple Card uses technology similar to other mobile wallets such as Apple Pay, Google Pay, and Samsung Pay. Every transaction is tokenized, which means that your card ID is masked and changed every time you use it.
In fact, the level of security here is similar to that of existing digital payment systems. The main difference is that since you won’t have a physical card to start with, Mastercard will have to send information to your phone remotely when setting up an account. It is not yet clear if such a feature could make information vulnerable, which could be exploited by hackers or malware, but Mastercard has been using payment cards for decades and has experience in preventing such attacks.
Who can benefit from Apple Card?
For those who use a credit card for the first time, or those heavily dependent on debit, an Apple Card might make sense. “Apple’s platform will give them the opportunity to immerse themselves in a familiar ecosystem before they hopefully move on to more useful products,” Honig said.
Apple Card, however, insists that it highlights the importance of financial literacy. This announcement not only stimulates media interest in the topic, but may also encourage users to explore banking services such as student loans and mortgages.
As with any major financial decision you make, getting an Apple Card should not be taken lightly. Managing your credit requires a lot of responsibility and some restraint. Apple may not be offering much that existing credit card companies have yet to do, but its entry into space will at least create healthy competition that promises good results for consumers.
The transformation of a tech giant into a bankruptcy structure
Until now, Apple has been a tech giant that has offered consumers all kinds of gadgets and accessories. But now the corporation is taking the path of petty retail usury. Apple has enough cash to provide credit processing worldwide, and phones will become consoles to enter the Apple ecosystem.