The Apple credit card has been announced to a large amount of attention, but it comes with pros and cons. Is this going to be the development that changes the entire cards and payments sector? Or is there too much hype?
Experts are in two mind about the new offering, but there is excitement regarding the tech giant’s proposition.
Lu Zurawski, payments practice lead at ACI Worldwide, says: “The Apple Card may provide genuine excitement for those of us who see the need to move away from traditional cards, toward more secure mechanisms, with in-built security to support stronger authentication, privacy and more personalised consumer experiences (and the switch from plastic to titanium is a nice touch).
“The steer from card to app/mobile is where the real action will be found. And as consumers continue to familiarise themselves with mobile-initiated payments options, it will not be a surprise to see alternative payment methods emerging which keep consumers, banks and retailers happy.”
Michael Rolph, CEO of Yoyo Wallet, believes it could shake up the industry.
He says: “For a tech company of its mammoth size, Apple has been very quiet in this space until now, having launched Apple Pay more than four years ago. So the first question to ask is why now?
“Well, first and foremost, if you are Apple, you’ll recognise that the hardware you’ve been providing over the years has effectively run to the end of its growth cycle. Nowadays, everyone has smartphones and laptops.
“So moving into financial services can only be seen as a natural next step – over half a billion people on the planet have an Apple account, which means they already have a colossal ready-made marketing base to provide these new services to.
“Also remember, Apple doesn’t do product in the way that most other companies historically have done product. Apple does experiences that happen to have product features.
“While we’ve yet to see the Apple Card in real action, Apple’s demo revealed, for the first time, a beautiful user-designed experience around a card product. It looks to me that they’re view is that it’s the user experience around the relationship with credit that they’re looking to fix.
“What does this mean if you are an existing lender of credit – i.e. a bank? In short, I think it should make them sit up!”
Is it too late for Apple Card to make an impact? People probably already have their favourite form of mobile payment by now. It could be Apple Pay even. Also, there are a multitude of fintechs and start-ups offering card products already.
Shachar Bialick, founder and CEO of Curve, says: “Apple’s introduction of the Apple Card was long anticipated. They have copied the ‘challenger banks’ playbook, with no fees, and slick card design. It may be a too small step and a tad too late, however it’s a step in the right direction.
“Like Curve, we believe that Apple will try and build an OS for Money. A platform which will move Banking to the cloud. What prevented Apple from being able to move Banking as we know it to the cloud, was the relatively low frequency of use of Apple Pay. The Apple Card, although nothing special, accompanied with the strength of the Apple brand, allows Apple to increase frequency of use, and with it, take it a step closer to joining the new category Curve is building – an OS for Money.”
Sankar Krishnan – Executive Vice President, Banking at Capgemini, comments: “It was fascinating to see the impact that Apple Card and Marcus can have on the consumer community especially in the US. As you recover from the brilliance of the strategy the mind pauses to take note of the following.
“There are a multitude of companies, Radiius and paywithbee.com which survived COIN and similar companies come to mind who can do the same for the other banks with whom Apple does not have a tie up with. The announcement (more details are awaited) seems to give the Apple Card a distinct advantage as other users give away part of their fee to be on the Apple Pay Wallet.
“I suspect it is not as free as the brilliant visual suggests but hopefully the consumers win. Either way you have to commend the quality of the launch and the fact that the Apple stock price does not possibly consider the fees from the card business.”
Overall, there are a number of pros and cons for the new Apple credit card. The general consensus is one of wait and see. There is excitement that such a company wants to create its own credit card. However, it may be a move that comes too late to make a dent. Apple Pay has hardly set the world alight, so what chance to Apple Card have?