Visa has been said to have made a bid of around $100 million to Apple to become the payment network for Apple Card and to replace Mastercard in this position. This news comes as Apple looks for new alliances after Goldman Sachs’s decision to leave the consumer lending market.
The Apple Card, launched in 2019 in partnership with Apple, Goldman Sachs, and Mastercard, has features like no charges, cash-back rewards every day, and easy integration with the Wallet app of the iPhone. With Goldman’s exit strategy, Apple is looking for new banking and payment network partners to maintain and develop its credit card business.
Besides Visa’s proposal, American Express is vying for the Apple Card collaboration, expressing a desire to serve as both the card’s issuer and network. Meanwhile, Mastercard is doing everything in its power to hold on to its current position in the partnership.
Apple’s choice of a new payment network is expected to precede the appointment of a new issuing bank. The firm is said to be negotiating with institutions like Barclays and Synchrony Financial to take the place of Goldman Sachs. The strategic move speaks to Apple’s interest in deepening its financial services line and staying competitive in the co-branded credit card business.
The bidding by large payment networks and financial institutions to become an Apple Card partner underscores the value of the Apple Card program, which has around $20 billion in balances. Winning this deal provides significant transaction volume and puts the successful network at the front of Apple’s growing reach in consumer financial services.
As Apple considers its alternatives, the result of these talks is expected to have far-reaching implications for the environment of co-branded credit card plans and the relationship between technology firms and mainstream financial institutions.
