Banking in the states must be pretty awful, because as someone living in the UK, I don't think there's anything here I don't already get with my existing bank accounts.
I can pay with my phone or a tap of my card pretty much everywhere, most banks have pretty advanced apps and APIs now, I don't think credit cards (or credit card debt) is as much of a "thing" here either.
I'm not saying it's bad, it looks nice and convenient, but it's not really a world changing banking disruption either. It just looks like an Apple branded version of what I've already had for years.
Banks in the US generally don't have APIs and adoption of contactless payments is not great.
I think that's the biggest thing here - you have a bunch of customers who will be incentivized to use contactless for better rewards. That should drive more people to use it and more stores to support it.
Contactless is already ubiquitous in the UK, everything from the local corner shop to the guy selling pizza at the last public event I went to takes it.
It's rare I have to put my pin in these days since I don't have many single transactions over 30 quid.
That's one of the funny differences I've seen between UK and US. Contactless is ubiquitous in the UK, and less so in the US. But there is no £30 limit on contactless payments in the US. I've used tap-to-pay with Apple Pay to spend hundreds of dollars in a single purchase, no pin, no signature, no problem.
A lot of people using contactless in the UK are using debit cards not credit cards which lack (here at least) the strong fraud protections that credit cards do - which is one of the reasons I put my new computer on my partners card then transferred the money to her bank to bank to settle it, so the £30 limit without pin acts as a brake on a stolen card giving the person who lost it time to report it as lost.
These are different things. There's a £30 limit on Android/Apple payments, and contactless cards if the payment terminal only supports contactless. If they have a new enough terminal that also directly supports Apple/Android pay, there is no cap.
The £30 Apple Pay limit in the UK is becoming less of a thing. In major retailers that accept Apple Pay I have used my phone to pay for items into the hundreds of pounds without issue.
Funny you mention PINs. We did finally get chipped cards in the US, but it’s “chip and signature” so we’re missing some of the security improvements. Harder to skim at least?
Phone and watch based NFC will eventually displace that I think.
I personally prefer Chip and Signature. We have the same system in Hong Kong where most cards have a Chip and PIN but most card readers will just ask for your signature anyway. It puts the burden on the merchant to check the signature instead of the cardholder to not have their PIN guessed/overseen. We also seem to have no limit on PayWave (contactless) transactions but for larger purchasers the merchant may ask for a signature over the "No Signature Required" slip anyway.
> It puts the burden on the merchant to check the signature instead of the cardholder to not have their PIN guessed/overseen
Maybe it's different in HK, but here in US and A I literally just make random scribbles (or sometimes just write "void" for kicks) and nothing is ever checked.
Works the same in HK but if you notice a suspicious transaction you can get it reversed when the signature doesn't match. If you use the PIN it's a lot harder to reverse.
I've noticed this year that a lot of card system vendors have updated their software to enable contactless on their card machines. I actually use my contactless card all over the place in the US, and I was even shocked and surprised to see that the MARC vending machines in Baltimore/DC supporting contactless to buy train tickets.
The number of US customers actually receiving the cards and being trained to use them is very low, and that's a problem.
As an aside, I actually like plain contactless better than Apple Pay. It's overall a faster transaction, no fussing with phone unlocks. I don't really care whether or not it's more or less secure - that's my bank's problem, not mine.
I have an Apple Watch, weirdly I don't find myself doing that a lot. Something about turning the screen around and being unable to see it. Although I think the newer watch versions have a better interface that comes up quicker. I might want to try using it more often.
Still, you have to admit that having a $400 watch as a barrier vs. a card that my bank gave me for free is a bit of an advantage toward the contactless card.
Same. Basically anyone with a newer Veriphone system (which everyone seemed to roll out back when we switched to chip) seems to support it. I use Google Pay, so it's not Apple-specific anyhow. But it's so much faster to process than the chip cards, even if I already had both my phone and card in my hand.
As someone who's done work on payment systems for both countries (online payments only).
In the US:
Credit cards have a bit better protections than bank accounts do. For example for bank transfers[0], if you wait a few days after finding out there is a fraudulent transaction, you are liable for $500. (if you reported it right away, it's only $50 liability). Credit cards max at $50 liability.
ACH for US banks is absolutely horrible. It's slow and just doesn't work well. FedNow that was just announced could help, but that's 5 years out (at least). TheClearingHouse has an instant payments platform out there, but only had 50% adoption right now, and costs a flat cost per transaction. Credit Cards are instant (ish), but have super high fees.
The US has thousands of banks (~5000), many of which are smaller local banks. Getting all these banks to be on a common system is hard.
In the UK:
You have BACS, which has some really nice properties (like when moving between banks, your auto-pay moves with you), but it has warts on it. Like ACH, all payments are successful after it's submitted, but you don't find out about rejects (like insufficient funds) until a day or 2 later.
UK has Faster Payments rails, but it is absurdly expensive (1-5 pounds per payment (EDIT: THIS IS WRONG)). It's same day, which is awesome, but it could be better.
UK does a lot more debit payments than the US, likely because debit in the US just has not-great consumer protections today.
The UK also has many fewer banks (~300), so getting them on common systems is a bit easier.
I don’t understand your comment about faster payments. At least for sending money between people it appears to be free and basically instant to transfer money. Maybe the bank just swallows the fee or doesn’t have to pay it for some reason.
How is Faster Payments that expensive? I can't imagine online banks like Monzo & Starling who offer free accounts, no fees whatsoever and thus very low profit margin per customer are paying that.
I had bad data apparently. It looks like some businesses (for business use cases) are charged that amount potentially, but it looks like the service ended up mainly being free. My bad.
* gives you cash back immediately after transaction
* and has no foreign transaction fees
* and has no late fees
* and has no annual fee
* and conveniently shows you the location of the transaction
* and has one click access to support via iMessage
It's a pretty nice package of features. Sure, it's not the highest cash back ever, but most people don't have time to be on HN and nerd out over credit card terms all day and this is great card for those people. I really hope they expand to more countries.
Credit cards are less of a thing in the uk. Cash back isn’t so common or so large because the merchant fees are much lower so there’s nowhere for the cash to come from. People also (as far as I’m aware) don’t buy as much on credit as they do in the US and they don’t accrue as interest on that debt either.
So a lot of these points are different between the US and UK (eg 1% cashback is quite a lot), and there aren’t a great number of UK credit cards that do have an annual fee (and if they do it is small).
Having no forex fee (and good exchange rates) tends to be a loss-leader for some cards in the UK (until they become known as a very cheap way to change money and start losing more and more on it).
Lots of credit-card related features (eg regarding late fees) matter less because a lot of the competition isn’t with credit cards but with debit cards (but then again banks tend to charge steep overdraft fees).
Contactless, a nice app, merchant location, and a messaging system for customer support is pretty common (for offerings like those mentioned by the GP). Messaging turns out to be a great interface because:
- the app can help guess what you want in common cases (eg moving house)
- it’s asynchronous so no one is wasting time on hold if it’s busy
- it’s text so automated systems stand a better chance of getting good quality data (like the new address) and guessing what the query is
Cards/bank accounts with fancy apps have been becoming a thing in the uk for perhaps 6-7 years and they’ve been becoming a bigger popular widely used thing in the past 3-5 years. So lots of these features can seem quite familiar to people.
It isn't world-changing in the US either, but a lot of people think it is because they aren't familiar with the vast credit card offerings in the US.
Credit card debt is definitely a thing in the US and it's nice that the Apple Card has some visualizations, but they also aren't unique to this card.
- Spending analysis tools: Most large US banks have this on their app or website.
- Cash back: a rather standard feature, and Apple's own rate isn't any better than other alternatives (Citi Double Cash for example). Quite a lot worse if you don't see yourself making most purchases with Apple Pay. Most online purchases will get the paltry 1% rate.
- You can actually get a better discount from Apple.com using other cards, believe it or not. Take the Chase Freedom Unlimited's 1.5% off everything, then add the 2 bonus points using the shopping browser cookie feature on the rewards website, so as long as you buy stuff online you're getting 3.5% off the Apple Store instead of 3%.
- Payment due dates always at the end of the month: Doesn't actually make any sort of a difference, usually due dates only change by a day or two at most.
- Due Date reminders: Email already accomplished this
- Real time fraud protection: Major US Bank cards already do this, usually via SMS or email
- Mapped transactions: I'm pretty sure some other banks do this but I will say it's somewhat helpful/innovative
- The fact that the Apple Card has no numbers or magnetic strip on it is something I consider a disadvantage. Yes, the USA is far behind on going 100% chip and contactless. However, US customers aren't liable for any fraud over $50 and most card issuers make that dollar amount zero.
Edit: I'm noticing that the Apple Card does allow a semi-permanent number to be generated, which does require you to have your phone around to look at it, it seems.
I don't care if someone steals my credit card number. That's not my problem. It's my bank's problem.
Not being able to use a credit card at a particular merchant because their point of sale system only has a card swiper is a problem to me. (Edit: Seems that Apple card has a magnetic strip. But if a merchant has to type in more info than the last 4 digits into their POS system you can't use an Apple Card).
I will say, in the US, the support for chip cards is now at nearly 100% and this year contactless has made major strides.
> The physical Apple Card, of course, has no number. The app displays the last 4 digits of the card number that is on the mag stripe of the card only, you never see the full card number.
So the card has a magstripe, and therefore, is no different than a regular card.
It's just that you now have to confuse your cashiers who are looking for verification info on the card when they're putting it into their point of sale systems.
I've had to tell my bank "it wasn't me" and it was a relatively quick process.
Also, most sketchy things are caught by the usage pattern algorithms before the transaction is even authorized. If I just blatantly emailed my card number to someone in Nigeria and they tried to buy a bunch of stuff there it would never go through in the first place.
Keeping some short numeric digit a secret seems like a rather vain effort to me.
This is separate from my desire for security to increase. Yes, I want security to continually improve. But the lack of client side security in the US doesn't actually impact consumers in a significant way, if you ask me.
Right, after which some combination of the bank and the vendor eat the cost of the fraud. This in turn drives up prices and fees.
Regarding time investment, you are just rolling the dice. Most of the time the transaction will just reverse. Some times you will have to fight it.
Also, the big thing that chips bring is related to duplication. The cards can’t be duplicated and transactions can’t be duplicated. The PIN is just a second factor. This is distinct from US Debit PINs, which are the only “secure” part of that system.
I don't care if someone steals my credit card number. That's not my problem. It's my bank's problem.
This is spot on. I refuse to use or even have a debit card issued for my actual bank account. Almost everything goes through CC's, so worst case, I have at least one layer between "my" money. As a bonus none of my CC's are from my bank, and I have several from different major vendors, so unless a lot of things go wrong at once, I should always have access to at least some amount of credit.
It's also made budgeting and tracking my spend much easier, since I don't want to pay interest on any of these things, and the tools for managing credit cards tend to be better than what I've seen for checking/savings accounts.
The banking in the US is fine. The experience varies a lot based on where you live, however, and how well the local retailers have implemented their POS system. I also have the same abilities you describe, and I live in the US, but I live in a major metro area with pretty good technology adoption at the places I shop.
I would say that banking in the US is good from a financial products perspective (we have lower banking fees than the Commonwealth), however our consumer financial products lag (i.e. credit cards, checks, online banking, etc).
It is. It really is. I remember when I first moved to the US (from NZ) and it was like going back in time 10 years in banking.
There's also some completely bananas things that they've only just started to kind of rectify: For automatic payments or to send money to someone online you provide your bank acc# to the recipient and then they tell the bank to give them money from your account.
That's literally how it works - if someone gives you their bank acc# you can't send them money, but 50/50 you can withdraw money from their account.
It gets better. Here's how the "security" works, say you're using ETrade or whatever and you want to link an external account, you give them a bank account number. Then they withdraw some money from that account and ask you to verify how much was withdrawn. Note that it's not the bank that controls the other account verifying you're meant to be able to withdraw money - they're not involved. It's literally etrade (or whoever) ensuring that you own the other account before etrade lets you pull money out.
I live in the Czech Republic, otherwise a developing country, however also a fintech testbed. I feel 10 years back in time when I'm in Germany. I was surprised how much annoyed I was. I really don't understand the US.
1% cashback on most purchases. 2% at Costco (requires membership). 3% at restaurants and pre-selected travel related purchases. 4% on gas. Requires Costco membership to redeem cashback.
In my opinion most people are better off with Fidelity's flat 2% card on all purchases ("Rewards Visa Signature Card"). No annual fees.
I would say it's the reverse -- tech companies gain more market value from customer stickiness than banks generate in fees fucking over customers. The difficulty using this knowledge in the US has been regulatory and compliance related.
The advertised payment UX use cases are already covered in Europe by challenger bank debit cards/apps like Revolut and N26. Apple is not really innovating here, but taking the model from startups and executing it within their large loyal audience.
This will make it difficult for challenger banks to get foothold in the US. Furthermore if Apple Card is supplied out of the box with iPhones, it might definitely change dynamics in card markets.
Edit: Even the site has similar dynamics as Revolut front page minus cryptocurrency scenarios https://www.revolut.com/
Every now and again I like to remind people that Apple doesn't really do "innovation". They do polish and mass-market appeal. Apple's rarely ever first to the table with any technology. They take what others are doing on a limited scale and ramp it up to the mainstream with a spit-shine.
Innovation comes in many shapes and forms: new capabilities, new production process, new design process, new user experience, new logistics, new sales channels, etc.
Apple is innovating on many levels, but maybe not the most on technical capabilities.
Haha! Made me laugh. From the top of my head:
1. FaceId
2. App Store that actually works for customers not against them.
3. Privacy respecting web browsers
4. iPhone - literally
5. iPad
6. iPod
Apple didn't invent any of those. They took existing technology and gave it a lot of polish.
FaceId: Facial recognition and the ability to unlock your phone with just your face existed on Android before iPhone.
App store that actually works for customers not against them: I've never had problems with Google's Store, or Steam, or any other digital store.
Privacy respecting web browser: Uh...Firefox?
iPhone/iPad/iPod: Apple did not invent the slate form-factor every phone uses today, and they certainly didn't invent the idea of a tablet computer.
Simply put, Apple isn't a tech company. They're a fashion company that makes technology fashionable. They're kings of UX and marketing, for sure, but innovators? Definitely not.
Apple did not invent the slate form-factor every phone uses today
Ever seen a blackberry in the last 10 years? A phone with a keyboard? A phone with a dialpad? Literally hand held computing is divided between Before iPhone and After iPhone.
Google Store? You mean the store where they allow anyone to host malware? Just "google" the number of apps that have malware on the Google Store.
Face ID on Android? over 2 years since FaceId but Android still can't enable you to do payments using Face Recognition because they don't have confidence in their camera system.
Safari was doing anti-web tracking way before Firefox was relevant again. Lets not even talk about mobile Firefox.
Literally the iPod changed the music industry. Hold on think about this, a single device changed how people heard, distributed and discovered music. If that's not an invention I'm not sure what is.
To be fair, I also think Apple hires some of the most creative marketing and UX folks.
I'm not sure why you assume negativity here? I have been a happy owner and user of several Apple products throughout the years and I think that from a business perspective they have been really nailing down market timing, one of the hardest things to get right with new products. If you're really doubling down on this angle, then I guess we're all doing innovation in some sense as long as we're adding anything new. Is Tinder also an innovation because of its success?
All great examples of Apple taking others' innovations, polishing obsessively to appeal to a broader market. Iteration is much more valuable than innovation when it comes to sales.
> Innovation, for its part, can refer to something new or to a change made to an existing product, idea, or field. One might say that the first telephone was an invention, the first cellular telephone either an invention or an innovation, and the first smartphone an innovation.
The iPhone wasn't even the first touchscreen smartphone or the best smartphone of its time. But it was the first Apple smartphone. I remember people showing off "how cool" it was.
Brand and product design are way, way more important to success than innovation is.
1. Windows Hello
2. Steam
3. Really..? How is Safari more innovative than Tor Browser? You can't argue that Safari was more privacy-respecting than Mozilla pre-Tor.
4. Windows Phones (I had one, it was more capable and powerful in any way compared to the first iPhone)
5. Windows tablets
6. There were tons of MP3/media players of different varieties before the iPod - what makes it so innovative.
The only example I can really come up with is the TouchBar. Even that had predecessors of different types, but they definitely did something new there. Users love it, I heard.
Isn't this just launched, with the feature set nowhere near the idea of securing payments?
2. Steam
AppStore has far more features and way more full featured. From Apps, Games, subscription models, app quality reviews. Also works on mobile.
3. Really..? How is Safari more innovative than Tor Browser? You can't argue that Safari was more privacy-respecting than Mozilla pre-Tor.
The right defaults. It takes a lot of innovation to come up with the set of defaults that are actually secure and protect you. If one thinks they're secure using the Tor browser, they have another thing coming.
4. Windows Phones (I had one, it was more capable and powerful in any way compared to the first iPhone)
Haha! Ubuntu is better Desktop OS than Mac and Windows.
5. Windows tablets
You're kidding right?
6. There were tons of MP3/media players of different varieties before the iPod - what makes it so innovative.
You seem to have missed the point of the comment you replied to:
> Apple's rarely ever first to the table with any technology. They take what others are doing on a limited scale and ramp it up to the mainstream with a spit-shine.
No one's arguing it's necessary or even desirable to do technological innovation to be successful or market tech products to the masses. New "things" generally need a generation or three until ready for that.
Taking existing facial recognition tech used for authentication in one domain (OS login) and applying it to a new domain (payments) is not innovation in my book. It's just the natural next step.
> An Apple Cash card is required. The Apple Cash card is issued by Green Dot Bank, Member FDIC. See www.apple.com/apple-pay for more information. If you do not have an Apple Cash account, Daily Cash can be applied by you as a credit on your statement balance. Daily Cash is subject to exclusions, and additional details apply.
(I'm not based in the US.) I'm guessing most US-based Apple customers already have an "Apple Cash" relationship/account with Green Dot Bank?
I don't think most of us had ever heard of Green Dot Bank before today. It appears to be a legal entity representing Goldman Sachs, which I'd at least hard of.
This is a really, really mediocre card as far as rewards go. No sign up bonus (nearly unheard of these days), might average 1.2% cash back if you use Apple Pay a lot (with exception of maybe a business buying a lot of Apple products - in which case should be spending on a business card). There are a few no-fee cards I can think of that give at least 2% on all purchases - most notably Citi's Double Cash Back card.
The only reason why I could see someone wanting this card is the novelty.
Banks offer sign-up bonus in order to bring more customers and they hope that after a year these customers will stay and start paying annual fee and keep using the card.
I'm sure Apple feels they will get huge interest in their card even without a signup bonus, so there's no need to offer it.
Right - it's a confusing strategy IMO. In general wealthier people who probably don't revolve credit (e.g. pay in full each month) want premium rewards, which this doesn't offer at all, so my hunch is that this will appear to more middle income/lower income individuals who pay interest (cost of interest negate any rewards), which is a bit strange since the branding/marketing and Apple (+ Goldman Sachs) generally target wealthier individuals.
Just kidding. It's cool to see the Apple design approach applied to a financial product. I'm happy with my current card, but I admit this is a much better designed experience (spend tracking, billing, customer support, software integration).
The most interesting thing I learned today is: according to TPG, most customers will only need to provide the last four digits of SSN to apply.
On the one hand, this seems great for privacy - you can't leak information you don't collect, right? On the other hand, does this mean someone can impersonate you with just the last four now?
And your phone with two factor authentication right?
Apple likely already has a relationship with the customer, so the riskiest accounts would be those that are brand new. But for even those, Apple would have significantly more information about the applicant than would be in a normal application (like the GPS coordinates of the phone).
The card has no numbers on it so I wonder what they would do in the (admittedly very rare) case when the card network is down. Usually merchants can produce an ancient machine to take a copy of the card number (similar to what they would do before telephone based payment networks were a thing) when the payment network isn’t reachable. I don’t think that it’s a case that matters at all but I’m curious to know if it’s one that is considered.
I would have thought that all credit/debit cards had to have raised numbers in a certain place but perhaps Mastercard can make some exception for apple (or other banks never bothered to try to do something a bit different).
Goldman has been accused of an assortment of misdeeds, including a general decline in ethical standards, working with dictatorial regimes, cozy relationships with the US federal government via a "revolving door" of former employees, insider trading by some of its traders, and driving up prices of commodities through futures speculation.
Wikipedia has a whole separate article about their controversial practices.
Fully agreed. I don't think anyone can dispute the fact that Goldman has done a ton of bad stuff, but none of that seems to have any relationship with the matter at hand, i.e., being a backing entity for a credit card (which, to me, seems like something that you cannot really fuck up tbh).
Well, as long as you're dealing with accusations and alleged behavior, why stop there? You need to inflate that list, yo! (Devils advocate and all that jazz.. ;) )
"big finance man bad" with no real substance probably. Nevermind the fact that if the parent is in the US and has 401k, he is very likely holding some assets facilitated by Goldman Sachs already.
P.S. Not trying to support GS at all, as I know more than a few negative things about them and I loathe a lot of what they did, but OP just seems to be making a cheap intellectually lazy jab at GS with no substance related to the context.
The presence of large oligarchical financial institutions makes me feel a little panic, so I make a point to check out “challenger” banks like, Zero[1], Chime[2], and N26[3].
(I’d reccommend Zero here because it, I think, is the only one supporting a credit card).
I still have a few privacy questions that I can't find answers to:
1. Will merchants that you purchase from know your name?
2. Does it work with online stores that don't support Apple Pay? Will you have to use your real name and billing address?
1. Yes, it's a normal credit card.
2. Yes, you can generate a new virtual card number with a CCV and expiration date in Wallet.
3. Yes, probably. Though most places don't actually verify that info, or they only care about the zip.
A couple of weeks ago I was in New York City, and I needed to buy a MetroCard from a vending machine at the entrance of a subway station. I stick my credit card (issued by a major Australian bank) into the machine. I proceed to pay. Then it asks me for my ZIP code. Living in Australia, I don't have a US ZIP code, but I do have a four digit Australian postal code. I try entering my four digit Australian postal code – it doesn't accept it, wrong number of digits. So then I just try 90210. That works, it processes the transaction and gives me the MetroCard.
The answer to your second question is into the link:
> A titanium, laser‑etched, Apple‑designed credit card. And Mastercard is our global payment network, so you can use it all over the world. For apps and websites, there’s a virtual card number in the Wallet app. It autofills for you when you’re using Safari
Hmm says no international fees, but what vendors would actually accept the apple card? Is applecard VISA/MasterCard or its own thing? How does this work with vendors if I'm a customer trying to use the apple card? Who accepts it?
If you need to pay for purchases that can't be made with Apple Pay, you can use the physical version of the Apple Card that Apple sends once you sign up. In addition to Goldman Sachs, Apple is partnering with Mastercard, so the physical Apple Card can be used wherever Mastercard is accepted.
Anybody planning on using this? Is it due to privacy or convenience (app stuff)? My current card get's 2.5% back on everything, plus other cards with rotating 3-5% categories. Not sure I will just to this just due to that .05%.
Alliant has a 2.5% back card (https://www.alliantcreditunion.org/bank/visa-signature-card)... it does have annual fee though, so unless you spend a lot of money on non-bonused categories it is probably not worth it.
Or if you can stash $100K with BoA or Merrill, BoA Travel Rewards give you 2.625% back (1.5% back + 75% bonus), with no annual fee.
Personally, I hate this style of webpage. I have to furiously scroll just to get past the title animation, which results in zooming past the rest of the content.
Even if you bought a lot of Apple products I would not recommend getting this card just for the 3% back.
FWIW I almost always use Cashback portals (e.g. check https://www.cashbackmonitor.com/cashback-store/apple-store/) when buying stuff online. Super easy way to get 2-3x points/$ or cashback is that usually at least 3% in addition to whatever cashback you might earn on your credit card.
I'm not sure I see what makes this card magically different from other cards?
I would be more impressed if they just said "we have a [expletive] tonne of money, lets charge like half the interest rate of other credit cards, after all we'll still make a tonne of money, especially when everyone switches to a vastly cheaper card"
As Apple is partnering with Morgan Stanley, I couldn't help but notice that the later's market capitalization is still lower than Apple's cash on hand: they could buy them in cash.
I wonder if financial services will be the next phase in Apple's growth.
I can pay with my phone or a tap of my card pretty much everywhere, most banks have pretty advanced apps and APIs now, I don't think credit cards (or credit card debt) is as much of a "thing" here either.
I'm not saying it's bad, it looks nice and convenient, but it's not really a world changing banking disruption either. It just looks like an Apple branded version of what I've already had for years.