Goldman Opens Apple Card To Subprime Consumers

Apple Card

With its new credit card in conjunction with Apple, Goldman Sachs is reportedly approving some borrowers who are subprime for the offering. The bank is accepting applications for the Apple Card from some users who have credit scores that are not stellar, CNBC noted in a report that cited unnamed sources.

Apple reportedly wanted its bank partner to create a platform that would approve the most possible U.S. iPhone users within the range of responsible lending and regulations, per the sources. The move is said to follow the desire of the technology company to offer its clients a good user experience.

The approval process is conducted through an iPhone wallet app and was reportedly created to provide most applicants with a decision within two minutes. During that period, the systems of the bank confirm the identity of applicants and that credit bureau records show they can pay back their debts.

The bank is tapping into Provenir, a software firm, to facilitate decisions, per an unnamed source cited in the report. And moving into subprime is not said to be a move without precedent for Goldman: According to the CNBC report, 13 percent of the $4.75 billion in Marcus business personal loans went to borrowers who have under 660 FICO scores.

There isn’t a standard definition for who is classified as subprime, but the outlet said that most have a FICO score of below 660.

The news comes as reports surfaced that Apple has invited certain customers to apply for the Apple Card. (Apple CEO Tim Cook had said during the company’s third-quarter earnings call that the Apple Card would be released in August.) Apple is looking to strengthen revenues as sales of iPhones slow, while the card is an opportunity for Goldman Sachs to expand its retail banking reach.

And, for the new credit card, Mastercard will provide the payment network. Customers who received access Tuesday (Aug. 6) were among clients who applied for notification at the time the credit card became available at first.



The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.