As we already know, Apple is in search of a new bank to replace Goldman Sachs to issue its Apple Card credit card.Apple has been in discussions with both Barclays and Synchrony Financial to possibly replace Goldman. Now, a new bit of drama is brewing, as The Wall Street Journal reports that both American Express and Visa are vying to replace Mastercard as the operator of the Apple Card payment network.
It is reportedly a three way battle, as Mastercard is also battling to keep its position as the Apple Card payment network. Visa has reportedly gone so far as to offer a $100 million upfront payment to Apple.
While credit card issuers and payment networks are usually two separate parties, American Express has a unique position in the financial world and could act as both issuer and network.
Currently, there are over 12 million cardholders in the United States, who have run up approximately $20 billion in outstanding balances.
While the Apple and Goldman Sachs marriage looked promising at the beginning, the relationship has soured over the last few years, due to customer service issues that have led to long wait times to resolve customer issues.
The U.S. Consumer Financial Protection Bureau has even launched an investigation into Goldman Sachs over the customer complaints.
In addition to the customer service issues on Goldman Sachs part, Apple has pushed the firm to approve applicants that may have normally been turned down and has also demanded that all Apple Card customers receive their statements at the first of the month, not on a rolling basis like most credit cards.
Goldman Sachs has been working to exit the consumer credit industry, after facing billions of potential losses. It sold its General Motors credit card business to Barclays.
Apple still has enough time to make a decision on a new payment network, as its contract with Mastercard doesn’t expire until 2026.
