Apple has confirmed plans to join the ranks of fintech disruptors targeting traditional banks, with plans to launch its own credit card, together with currency exchange services and cashback incentives.
Group CEO Tim Cook said that Apple “saw an opportunity to transform another fundamental method of payment. That’s the credit card. We think Apple’s uniquely positioned to make the most significant change in the credit card experience in 50 years.”
The Apple credit card is expected to be released in the US this summer, before a likely roll-out internationally at a later date. It will be issued by Goldman Sachs, while MasterCard is to provide support as a key payment services provider (PSP). Apple’s iPhone, which already can be used as a wallet, will become the new hub for all forms of payment, both online and offline.
The banking app is expected to leverage location and other data from users’ iPhones to help track and provide insights into users’ spending habits.
Initial responses to Apple’s new offering is that the service is relatively straightforward and very in line with other ‘virtual’ banks such as Revolut or Monzo, which have attracted customersof traditional banks with their own digital banking alternatives. One distinguishing feature is that the Apple card will be made from a luxury composite (titanium) and its sleek design omits any card number, expiry date, or even signature.
However, analysts suggest that the Silicon Valley giant is likely to follow competitors in developing additional financial services including loans, investments, trading, and potentially even cryptocurrencies. Apple could even prove more ambitious by launching its own native and fiat-pegged currency on its wallet and banking platform
In terms of active users for its iOS platform, Apple rivals the reach of Facebook for the accolade of the world’s biggest single place to interact and do commerce. Facebook is reported to have advanced plans for entering the native currency market with its blockchain-based payment system, which could be unveiled before the end of the year.
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