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Apple
S
(ticker: AAPL) new credit card, a partnership with
Goldman Sachs
(GS) that was announced yesterday, is a slight negative for
Visa
(V) and a slight positive for
MasterCard
(MA), Wedbush's Moshe Katri said in a note to customers Tuesday morning.
Payments on the card will be processed by Mastercard, said Apple yesterday.
The action Mastercard rose from just under 1% on Tuesday after closing flat on Monday. Visa closed up 1% on Monday and gained 1.2% on Tuesday. Apple's shares fell by just over 1% on Monday and rose about 1.3% in trading on Tuesday. Goldman shares remained unchanged Monday and gained just over 0.5% on Tuesday.
The story back. Apple has released details of its highly anticipated credit card yesterday as part of several new products that it hopes will increase the company's revenue through recurring subscription services such as Apple TV and Apple Arcade , a game service.
The card can be managed from the iPhone and linked to Apple Pay. In a gesture that points to Apple's priority of keeping cardholders in their ecosystem, purchases made with the card with Apple Pay will receive a daily refund of 2%.
Goldman Sachs is Apple's partner financial institution, and the physical card uses "Mastercard's chip and chip technologies M, which allow the card to be stored on a digital device without exposing its data," wrote Katri.
What's up. Katri believes that the consequences of this announcement for payments and fintech are a modest improvement for Mastercard and a modest negative for Visa, since Mastercard will process payments on the card. Katri has Outperform notes on Mastercard and Visa.
Goldman Sachs has been working for years to develop its personal banking products by offering, among other things, chequing accounts and savings accounts to retail customers for the first time in its history.
Looking forward to. In general, analysts do not view the new card offering as an important revenue vehicle for Apple or Goldman Sachs. Other cards already on the market offer richer rewards. "Frankly, I'm discouraged," said Ted Rossman, an analyst at CreditCards.com, at The Wall Street Journal. "People will sign up, but it will be mostly because they like Apple, not because this card is better than anything that already exists."
Write to Ben Walsh at [email protected]
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