Mike Peterson
Apple is currently developing new technology and infrastructure to bring a wide range of financial services for consumers in-house, reducing its reliance on outside partners.
The multiyear plan is said to include payment processing, risk assessment, fraud analysis, credit checks, and additional customer service functions. Part of the project has been dubbed by the internal codename "Breakout."
Currently, the project is focused on future Apple financial projects and not current ones. Apple relies on third-party financial companies like Goldman Sachs for services related to Apple Card and its own financing programs.
News of Apple's alleged project sent shares of the iPhone maker's partners — including CoreCard Corp. and Green Dot Corp. — down more than 8% in intraday trading on Wednesday.
The project would propel Apple deeper into the financial services world, building on a lineup that already includes the Apple Card, peer-to-peer Apple Pay payments, and the Wallet app.
While the move could reduce Apple's reliance on third-party partners, it could also help the company expand into other countries. Apple Pay, for example, is available in 70 countries and regions worldwide. Apple Card, on the other hand, is only available in the U.S.
Apple is also reported to be working on related projects, including a hardware subscription service that would allow users to own iPhones with monthly payment plans. Analysts believe that the company could stick with third-party financial partners at first to offset any potential risks, however.
The company is also said to be developing a new "buy now, pay later" platform in partnership with companies like Goldman Sachs and Affirm subsidiary PayBright. Apple launched the Affirm program in Canada back in 2021.
One of the first parts of "Project Breakout" could be a first-party credit card processing tool that could replace its use of CoreCard. Bloomberg Wednesday's report claims that Apple could first rely on its first-party financial services for the rumored "buy now, pay later" program.
Wesley Hilliard
Malcolm Owen
Andrew Orr
William Gallagher
Sponsored Content
Christine McKee
Thomas Sibilly
14 Comments
This project will propel the stock price significantly higher.
I imagine the initial AppleBank™ rollout could feature blockchain based AppleCoin™ operating at near break even margins to support fast banking services growth. Imagine getting reasonable interest rates and no nickel and diming customers with hidden fees. Imagine an open and honest bank. It would be revolutionary.
It would also be damn near impossible because doing so would create a long list of business and Government enemies for Apple. Any moves in this direction will have to be turtle slow. But one can dream.
This feels like an Apple Car financing move. Hopefully they follow Tesla and take on auto insurance too. AppleCare for cars. Would love to see improved Mac financing too. They really should have 2-3 year financing for Macs to reflect most peoples upgrade cycle better. It used to be 18 months, but dropped back to 12 months with Goldman Sachs.
I'd like Apple to branch off its financial services into another company. Somehow it doesn't sit well with me that the company that produces my phone and computer also does banking. AppleBank? Ugh! A lot of this is optics, I know, but optics are important.