Apple Card Savings Account Part of Tech Giant’s Fintech Plans

Hello! Dan DeFrancesco in NYC, but I’m considering a trip to Canada to grab some of these chocolate bars from this woman who literal can’t give them away fast enough.

Today we have stories about BlackRock’s Larry Fink taking a pay cut, KKR’s new look and perhaps NYC’s most exclusive gym.

But first, can I see your phone?

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1. An apple a day…

Quick, name a fintech.

What is the first name that popped into your head? Robin Hood? Stripe? PayPal? Doorbell? Plaid? The square?

There’s one I bet most of you missed, and it’s a big one: Apple.

The tech giant isn’t always rated, but it has made a case for itself as a key fintech player over the years. Especially when it comes to payments, it has made progress via Apple Pay, Apple Wallet and the Apple Card.

On Monday, Apple took another step deeper into financial services, announcing the launch of a high-yield savings account (4.15%) via its Apple Card.

So does Apple want to be a bank? The answer to that question is emphatic: No!

Banks are not fun businesses to run from a technical perspective. There are lots and lots of regulations and bureaucracy to consider. Also, valuations for banks are not nearly as generous as they are for tech companies.

When the Apple card faced allegations of gender discrimination in relation to credit limits, it was Goldman Sachs, Apple’s banking partner, who initially took the heat, not the technology gain. (A regulatory investigation found no evidence of fair lending violations.)

So at a time when many consumer-facing fintechs are struggling to break even, or potentially be bought at a discount from their previously sky-high valuations, Apple continues to trudge along with what is essentially a side hustle for the already massive tech business.

The possibilities are endless when you consider the range Apple has. In early February, Apple reported that it had passed 2 billion active devices! It’s a distribution channel! (Yes, I realize it’s devices, not users, but you get the point.)

The irony is that the business Apple created is partly what one of its key partners – Goldman Sachs – wanted for itself.

Goldman had big ambitions to take over Main Street with Marcus, but the business never quite got off the ground. And now, as Goldman tries to save what’s left of consumer dreams, Apple continues to roll on.

To be sure, Goldman can claim that this is part of the plan. As it becomes easier to go directly to the consumer, and the bank’s platform solutions department seems to stop spending money, the new pitch is about Goldman as a behind-the-scenes partner. What better test case than doing it with one of the biggest companies in the world?

What’s not clear, however, is what kind of terms Goldman will get to serve as a back-end partnership partner. Banking-as-a-Service is a crowded field, and while the Goldman name has some cachet, I’m not sure it’s worth that much in this particular space.

Lucky for us, Goldman reports earnings today.

Click here to read more about the top eight leaders shaking up payments, including a key leader in Apple Pay.

In other news:

2. Hey everyone, come hear how good we sound! Insider’s Dakin Campbell (aka the guy whose Goldman stories I always link to) sat down with Russell Sherman for his Press Profiles podcast to discuss what it’s like covering Wall Street’s top executives. Listen to it here.

3. Helping expats get some credit. Getting a credit card in a foreign country can be a nightmare. Enter Yonder, which offers credit cards with rewards for a monthly subscription fee. Here’s the pitch deck it used to raise its final round.

4. Inside the pass to the guard at KKR. While KKR co-founders Henry Kravis and George Roberts look set to pass the torch to co-CEOs Joseph Bae and Scott Nuttall, the PE giant is also in the midst of reimagining itself, reports The Wall Street Journal. More about the shift here.

5. Wall Street Executives – They’re Just Like Us! BlackRock CEO Larry Fink saw his pay cut by 30% last year amid market uncertainty in 2022. Fink took home just 25.2 million dollars. He is not alone, as other top executives saw their pay shrink.

6. Here’s why your boss really wants you back in the office. It’s not because of the company culture. It is not because of commercial real estate. It’s not even because they think you’re killing yourself. Insider’s Aki Ito breaks down why bosses hate WFH. In short, they think it’s for sissies.

7. Wells Fargo vs. trade union. Broader union support in recent years, along with successful campaigns at other companies, has bank executives worried about internal union efforts, Bloomberg reports. For more on Wells Fargo employee unionization, click here.

8. The case for Andy Saperstein as future Morgan Stanley CEO. The head of the bank’s $4.5 trillion wealth management business is shaping up to be a prime candidate to take over from James Gorman, Bloomberg reports. We have also found out more about why all the big banks could make a change of management this year.

9. Get ready for barbecue season. Contrary to what some might say (even in this publication) grilling food rocks. But if you want to switch things up, maybe a pellet grill is more your speed. We’ve got you covered. Here are five of the best.

10. Inside the Raya of gyms. Brooklyn’s Ghost is an exclusive gym that requires an application and personal interview. Founded by a former investment banker (because of course it is), Ghost memberships can cost up to $300 a month. Here’s Jordan Parker Erb’s review, including photos, of the high-end gym.

Curated by Dan DeFrancesco in New York. Feedback or tips? Email [email protected], tweet @dandefrancesco, or connect on LinkedIn. Edited by Jeffrey Cane (tweet @jeffrey_cane) in New York and Hallam Bullock (tweet @hallam_bullock) in London.