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Apple deploys a credit card that, she says, is designed to do things that no other card can do. So, how is it really going?
This looks like a traditional credit card: there is no number on the front and the user's name is engraved on the metal. The card expands the company's Apple Pay digital services by combining the physical card with a virtual card and integrating both with the iPhone. And that goes with a host of benefits: fast registration, removal of most fees, important security protection and cash back. But industry experts say they are not impressed – the financial benefits reflect many of those already available to consumers.
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HOW MUCH DOES IT COST?
Apple says that there is no charge associated with the card. This means no late fees, no annual fees, no international fees or excess fees. He also stated that he was aiming to have some of the lowest interest rates in the sector. Users must have an iPhone to use the card, which has a cost. But they will earn money on their purchases – 3% on Apple purchases, 2% on those with virtual card and 1% with physical card.
"I'm disappointed," said Ted Rossman, an industry analyst at Creditcards.com. "People will sign up, but it will be mostly because they like Apple, not because this card is better than anything that already exists."
He quotes Citi's Double Cash card, which offers an easy-to-use return of 2% on any purchase. Or the American Bank Infinite Reserve Visa Infinite Card, which offers 3 points per dollar of money spent on a mobile wallet: a cash back of 3% or a 4.5% discount on travel . Rossman said that even another branded credit card, the Visa Uber card, stood out with a 4% cash back on restaurant purchases.
Apple points out that this is the only card to provide these rewards in real time, so that the money earned can be used immediately. Other companies often have users wait for a cycle of statements or until the invoice is paid. But WalletHub's CEO, Odysseas Papadimitriou, is a dubious man who can afford an iPhone and who qualifies for the card, but he will need that money so quickly. He also reiterated that there were better rewards, especially for people with high credit.
"There are other cards that offer better rewards and no annual fees," he said. "There is a healthy market there, so from this point of view, there is nothing unique."
A note on interest rates also: the card will not come out before summer, but Apple said that as of March, the variable annual percentage rate of the card could range from 13.24% to 24, 24% depending on the solvency. That's the rest of the market, Rossman said.
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WHAT IS IT SECURITY?
Apple is proud of the privacy and security, so no surprise, the card stands out here.
The physical card has no number, the purchases are made with the integrated chip and the digital version is in your wallet Apple Wallet on your phone, where it is protected by fingerprints or facial recognition. This means that even if someone steals your phone, he will not be able to use the card to buy items.
Apple says it does not know what you buy with the card, where or at what price. And this indicates that Goldman Sachs, with whom Apple is working to provide the card, will only use your data to make the card work (for example, help with buying or fraud protection), but your Apple card data will not be used for any other purpose.
Even critics admit that Apple Card technology provides a new layer of protection that is not available with other cards. And mobile payments, such as Apple Pay, are generally more secure than traditional credit cards.
However, consumers already have a zero credit card fraud liability, Papadimitriou said. Federal law limits the consumer's responsibility for fraud to $ 50, but all major credit card networks (Visa, Discover, American Express and Mastercard) assume no responsibility for consumer cards. Apple is working with Mastercard to create the Apple card. So, he said, the extra protection could be more a perception than a reality for most.
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IS IT EASY TO USE?
According to Apple, users will be able to register to the card in the Wallet application of their iPhone and start using it almost immediately. He also tracks expenses over the phone in a more user-friendly format, eliminating the mumbo jumbo that populates a traditional credit card statement.
It also includes some budgeting tools, such as tracking expenses and forecasting the amount of interest that can be charged on a purchase, to help users make an informed decision. It allows users to set up weekly or bi-weekly payments to better match their paychecks. While these benefits are interesting, there are similar budgeting tools on other cards and the information only includes purchases and payments for Apple Pay and the Apple Card; it does not provide a complete financial picture. However, Apple users often appreciate the transparency of the information.
There is always a little wait-and-see because the power of the Apple brand and its fans is strong. In general, however, credit card industry experts believe that it is an offer from Apple to extend its Apple Pay services. Although Apple Pay is the most popular wallet payment service, only 13% of smartphone users have tried it, according to the industry tracking website, PYMNTS.com.
"Apple makes great software, but I'm not sure that they really understand the needs of consumers about it," Papadimitriou said.
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If you have personal finance issues, we want to hear them. Send an e-mail to the AP at [email protected].
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Follow Sarah Skidmore Sell on Twitter @sarahssell
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