Apple is working on a multi-year plan to bring its financial services in-house in the future. The project, known internally as “Breakout,” is designed to cut down on Apple’s reliance on financial partners, like Apple Card partner Goldman Sachs.
Bloomberg reports that Apple is developing payment processing technology and infrastructure such as lending risk assessment, fraud analysis, credit checks, and dispute handling. The Cupertino firm is also reportedly working on tools for calculating interest, rewards, approving transactions, reporting data to credit bureaus, increasing credit limits, and more.
Apple work with Goldman Sachs Bank and Green Dot for Apple Cash, and Citizens Bank for the iPhone Upgrade Program, but Bloomberg says Apple’s work on financial services would be aimed at future products rather than its current products.
Still, the news about Apple’s moves sent shares of CoreCard Corp. and Green Dot Corp. — two of Apple’s existing partners — down more than 8% apiece on Wednesday. Goldman Sachs Group Inc., another key partner, slipped as much as 1.2%.
Apple is working on a future subscription service for its hardware, along with a “buy now, pay later” scheme for Apple Pay transactions called “Apple Pay Later” internally. Apple Pay Later is expected to be the first Apple program to use Apple’s new system.
Options will include a four-payment option called “Apple Pay in 4,” and an option for long-term payment plans through “Apple Pay Monthly Installments.” The Apple Pay in 4 feature could use Apple’s in-house payment processing, while the longer-term financing option would be handled by Goldman Sachs.
Apple’s still in development system could also be put to use for the hardware subscription plan it still has in the works, and Apple could also serve as a lender for its “buy now, pay later” program.
As always for reports like this, Apple’s plans may change a bit or they may change a lot. So, Apple could delay or cancel its plans.