Apple to End Credit Card Partnership with Goldman Sachs: Report
Back in July, reports claimed Goldman Sachs was in talks about selling its partnership with Apple Card to American Express, as part of the former’s plan to scale back its consumer business.
Now, the Wall Street Journal, citing individuals familiar with the situation, say Apple is planning to terminate its credit card collaboration with Goldman Sachs.
Apple has proposed to exit the contract within approximately 12-to-15 months, involving all consumer partnerships, including the credit card launched in 2019 and the savings account introduced this year. Apple Card was only in the U.S. and never made its way to Canada—but we’ve been following the situation closely.
Details about Apple securing a new card issuer remain unknown. This move signifies a rapid reversal for a partnership that was extended through 2029 just over a year ago, initially envisioned as a key component of Goldman’s consumer market aspirations.
Goldman Sachs reportedly began reconsidering the partnership towards the end of last year following substantial financial losses in its consumer operations. Goldman informed Apple earlier this year about its intention to offload the partnership, where Apple typically holds a dominant role.
Discussions have taken place between Goldman and American Express regarding transferring the program, although Amex has expressed reservations about various aspects, including loss rates. Synchrony Financial is also exploring the possibility of acquiring the credit-card program. Synchrony, a major issuer of store credit cards in the U.S., had previously competed with Goldman for the Apple credit-card initiative.
Goldman Sachs is currently strategizing to retain credit-card employees until the transition of the Apple account, offering compensation packages to those whose jobs may be eliminated. This initiative also extends to employees in legal and engineering sectors who primarily support the consumer-lending unit.
If Apple finds a new partner for Apple Card, and it is American Express, there might be hope for Canada. When Apple Pay first launched in Canada–its partner was American Express, as iPhone in Canada exclusively told you at the time back in November 2015.