Tech Giant Seeks New Credit Card Partner
Apple is on the hunt for a new credit card partner, and Barclays is reportedly in the running to replace Goldman Sachs. According to sources familiar with the matter, the two companies have been in talks for several months, although a deal may still be months away.
A Shift in Ambitions
Goldman Sachs, which launched the credit card with Apple in 2019, is scaling back its consumer finance ambitions. The Wall Street giant has set aside billions of dollars to cover potential losses in the business, leading it to reassess its priorities. Meanwhile, Apple is seeking a new partner that can help it expand its credit card offerings.
Multiple Suitors
Barclays isn’t the only contender vying for Apple’s attention. Synchrony Financial, a leading credit card issuer, is also in discussions with the tech giant. Other financial firms, including JPMorgan Chase, have expressed interest in partnering with Apple, drawn by the opportunity to work with one of the world’s most recognizable brands.
Risky Deal Terms
However, potential partners are wary of the original deal terms, which were seen as risky and unprofitable. This has led to a cautious approach, with multiple firms weighing the pros and cons of partnering with Apple.
A Changing Landscape
The credit card landscape is shifting, with Goldman Sachs transferring its General Motors credit card business to Barclays in 2024. This deal allowed customers to earn and redeem reward points on new GM cars, including electric vehicles, and marked a significant expansion of Barclays’ card footprint in the U.S.
Goldman’s Retreat
Goldman Sachs’ decision to scale back its retail ambitions marks a significant shift in its strategy. The company entered the consumer business nearly a decade ago, aiming to diversify its revenue streams beyond trading and investment banking. However, the move has proven costly, with billions of dollars set aside to cover potential losses.
What’s Next?
As Apple continues its search for a new credit card partner, one thing is clear: the tech giant is committed to expanding its credit card offerings. With multiple firms in the running, it remains to be seen who will ultimately secure the partnership. One thing is certain, however: the credit card landscape is poised for significant change in the months ahead.
Leave a Reply