"Apple Prepares Deposit Service with Goldman Sachs Offering 'Cashback Rewards and Interest Payments'"

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Apple, which launched the Apple Card, a credit card, in the United States in 2019, announced on the 13th (local time) that it will introduce a deposit account service offering high interest on cashback rewards within a few months. This is interpreted as part of Apple's strategy to expand consumer financial services for iPhone users.

According to CNBC and other outlets, Apple stated in a press release on the same day that it will launch such a service. When paying with the Apple Card, Apple offers cashback on a portion of the amount spent, which it calls "Daily Cash." The deposit account Apple is introducing will allow users to automatically deposit this Daily Cash and earn interest on it, enabling the funds to grow.

Apple explained that there will be no fees or minimum deposit requirements.

This announcement comes as Apple is expanding consumer financial services to allow users to conduct banking and credit-related tasks easily via the iPhone. Apple currently operates a payment network through Apple Pay and has been issuing the Apple Card credit card since 2019. By the end of this year, it also plans to launch a "Buy Now, Pay Later (BNPL)" service, a short-term retail financing loan service.

CNBC reported that Apple appears to be leveraging the current situation where the U.S. Federal Reserve (Fed) is raising interest rates, noting that many traditional offline banks have not significantly increased deposit interest rates despite the hikes. The national average deposit interest rate in the U.S. is reportedly only 0.16%.

Some express concerns over Apple's aggressive expansion into financial services. In particular, foreign media reported last month that Goldman Sachs' credit card division recorded a loss rate of 2.93% in the second quarter, higher than that of loan companies, attributing this to the Apple Card.

In fact, Goldman Sachs revealed in August that U.S. consumer financial regulatory authorities are investigating how Goldman Sachs, including Apple, manages its credit card business.