What Banks & Credit Unions Can Learn from the Apple Card Experience

A veteran financial institution marketer applies for the new card and explains feature by feature why this sophisticated, co-branded credit card raises the bar in several key areas of digital banking. Apple Card's success is not assured, but its innovations can't be ignored.

As someone who has spent nearly 20 years of my career to date in the competitive trenches of financial institution marketing and strategy, I was intrigued by Apple Card’s official launch. In fact, I immediately applied for the card.

Financial institutions of all sizes should take note: This product has the potential to significantly disrupt the industry on many fronts. The naysayers who said that big technology companies would not be able to disrupt traditional financial institutions were wrong.

The Apple Card Experience Step by Step

The experience applying for the Apple Card is eye opening and informative as to the state-of-the-art in mobile functionality. Here is a description of my experience using my iPhone XS Max:

Application Process: Bar none, there is nothing in the marketplace that gets close to the credit card application process Apple designed in collaboration with Goldman Sachs. Using powerful artificial intelligence algorithms, the card lending approval decision is performed in seconds in a four-step process on the screen of your iPhone. It’s fast, simple, easy, and intuitive. You can use the virtual card right away for online purchases and at merchants that are Apple Pay enabled [about 70% of U.S. merchants, according to Apple].

“Bar none, there is nothing in the marketplace that gets close to the credit card application process Apple designed in collaboration with Goldman Sachs.”
— Andre Iervolino

Price: There are no fees. That striking fact is stated on the screen multiple times just to be sure you don’t miss it.

Rate & Credit Limit: The APR varies from around 12-22% and it is defined based on credit score. These rates are competitive in comparison to leading credit cards in the market place with similar product features. My limit was determined based on current credit card limits I have through other financial institutions, my credit score, and income.


Rewards: Very competitive. 3% daily cash back every time you use Apple Card with Apple Pay for all purchases made directly with Apple. 2% daily cash back on all other transactions done online and through Apple Pay. 1% daily cash back for transactions done with the swipe of the physical Apple Card. Apple has already extended the 3% to include Uber and Uber Eats and says it will extend it further.

Here’s the kicker: All cash rewards are transferred to your Apple Cash Card and you can move the money directly to your bank account every day by end of day. There are two options: You can transfer the balance instantaneously by paying a small fee (express transfer) or wait one to three days (traditional transfer).

This is the best form of collecting rewards in the market place at the moment — instantaneous cash back rewards.

User Interface: Best in class — made for iPhone and Apple’s mobile wallet. The user interface looks beautiful, uncluttered, with all the information you need available on the screen in one quick glance. The virtual Apple Card changes colors as you use it. You can order the physical card right in the screen, set-up automatic payments, manage spending with the intuitive UI and can see your personal spending habits and trends for your own analysis. It also gives a map location of every merchant where you had a transaction, beautifully displayed on your iPhone screen. Pretty slick.

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Security: When you click on the card information button — and after your face or fingerprint have been recognized by the Apple Card Wallet ID technology — it takes you to a screen with your card number, expiration date, security code, etc. You can request a new card number at any time right on this screen and it will be provided to you right away. That changes the physical card number as well since the actual card is numberless.

The combination of Apple ID, phone access, Apple Pay tokens, face and touch ID to access card information make the Apple Card one of the most secure types of payments available right now.

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Card Design: Absolutely gorgeous. White titanium card with a clean, simple look — very “Appleish.” It will appeal to many customers as a symbol of status and progressiveness. It will also likely last way longer than the current low quality plastic cards we have all been used to for decades now. Physical card delivery should take five to seven business days, which is pretty standard.

Card activation. Card comes in a very cool Apple package/envelope. You open the envelope, wake your iPhone and wave the phone over the card and it gets activated automatically. No phone calls to activate card necessary. A very innovative feature.

Customer Service: Another home run for Apple and Goldman Sachs. In the Apple Wallet, you can click on the Apple card, and you will have the option to call, text, visit Apple’s website right off the screen. I tested the texting feature. The artificial intelligence bot that took care of my questions was quite impressive and communicated in a human-like fashion I have yet to see from leading businesses. Only Google and Facebook are at the same level here.

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Copy the UI to Avoid Becoming a Utility

I believe that the predictions about financial institutions becoming a “utility” business may really come to fruition. It seems Goldman Sachs has not designed anything but the back-end of the loan approval, and they have the banking license. Everything else was designed by Apple, including the user interface, rewards payments, and the physical card.

My suggestion for financial institutions is to look at their current mobile banking user interface and consider how to design/build a UI that looks like the iPhone mobile wallet. In other words, one where the features of the mobile banking application are stacked like cards just like the Apple Wallet (one for Checking, one for Credit Card, one for Mortgages, and so forth).

In addition, financial institutions that will acquire market share in the future must use AI and design APIs that will duplicate the Apple/Goldman Sachs loan application and approval processes.

Banks and credit unions should also monitor their customers who have iPhone with Apple Pay enabled. Likely a good chunk of them will select the Apple Card as their top-of-wallet credit card, in fact the application asks them if they want to do that. There are over 100 million people in the U.S. who have an iPhone. Even if we assume the Apple Card is adopted by only 10% of current iPhone users, we are still looking at ten million people just in the United States adopting the Apple Card.

And what would stop Apple and Goldman Sachs from developing similar strategies, products, and UIs for auto loans, mortgages, and other financial products? Make sure you have a plan to address these market threats — not tomorrow, but today.

Andre Iervolino has more than 20 years of experience, much of it with several credit unions responsible for corporate planning, marketing, business intelligence, data analytics, customer success/engagement, and digital transformation.

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