With the Apple Card, Goldman Sachs is getting into the subprime lending business

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With the Apple Card, Goldman Sachs is getting deeper into the subprime lending business

Both companies want to cast a wide net for their new consumer products, making lending and tracking payments dead-simple. To do that, Apple needs to offer its first credit card to as many of its customers as possible. Goldman needs to open its doors to customers it typically doesn't serve.As the new Apple Card begins to roll out, some of its first members have no credit history or below-average credit scores."Goldman was willing to take a little bit of a risk here.

99% interest rate, which is below industry averages, and offers 3% cash back on Apple products, 2% on any Apple Pay purchases and 1% on all other purchases.Nomura analysts predicted in a new report Wednesday that it would take Goldman Sachs four years to break even on an Apple Card customer, assuming it took $350 to acquire the customer and that person spent $5,000 a year with an 18.5% APR.

 

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Mehhh. Just another me-too credit card.

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 /  🏆 4. in JP

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