Apple Card partner Goldman Sachs isn’t worried about the profitability of the Apple’s upcoming virtual credit card offering, and believes customer engagement is more important than financial gain.
Omer Ismail, who leads Goldman’s Marcus division spoke at Business Insider’s IGNITION: Transforming Finance event on Monday, and said the firm is using the Apple Card’s unique features to gain a toehold in a new market.
The Apple Card is a digital-first credit card with iPhone-enabled features and unique tools for users to tracks and manage their expenses. While the interest rates on the card aren’t impressive, Apple Wallet features can offer incentive for customers to pay off their debt each month instead of carrying over a balance.
Being as this is an Apple service, privacy is valued, meaning Goldman Sachs won’t have the same access to customer data a bank might have with other credit card offerings.
The card’s lack of fees, encouragement to pay off balances, and a lack of access to customer data is expected to make the offering less profitable for its backers than a traditional credit card offering. A report in May claimed Citigroup and possibly other banks backed off from the Apple Card due to worries over profitability.
However, Ismail says Marcus isn’t worried about the profitability of the Apple’s upcoming virtual credit card offering, and believes customer engagement is more important than financial gain.
“When I think about Marcus overall, the idea that doing right by the customer means being less profitable is just not an idea we subscribe to,” Ismail said. “If you do right by the customer, you’re going to ultimately win their loyalty.”
Apple Card is due for release this summer. For more information about Apple Card, visit the Apple website.