[HN Gopher] Apple introduces Apple Pay Later
___________________________________________________________________
Apple introduces Apple Pay Later
Author : dm
Score : 158 points
Date : 2023-03-28 15:31 UTC (7 hours ago)
(HTM) web link (www.apple.com)
(TXT) w3m dump (www.apple.com)
| oh_sigh wrote:
| What's the value proposition of a zero interest/no fee buy now
| pay later scheme? Is it just reaming folks who miss a payment? A
| loss leader getting more users into the Wallet ecosystem?
| florbnit wrote:
| My SO recently bought an electric bike using this sort of
| scheme, not from Apple obviously, but the monthly payments
| toward the 3500$ bike were less than what it cost to commute to
| work using public transport before that. So it turned from an
| being a non trivial investment to an obvious thing to do.
|
| The value proposition to me seems to be that they sold a bike
| at 3500$ they would not have sold otherwise and they can deal
| with the payment being made over time rather than all at
| purchase time.
|
| For the user the value proposition is that value adding
| purchases like this can be made and paid off while they provide
| value.
| rootusrootus wrote:
| That situation is close to the textbook example for when a
| debt hawk like Dave Ramsey would tell you it was okay to use
| a credit card. When you are actually using it to facilitate
| an investment in your future, not just buying toys. The
| additional zero-interest aspect is icing on the cake.
| pythko wrote:
| I found this video to be a good explainer:
| https://m.youtube.com/watch?v=R1JaMRpcDrQ&pp=ygUbQnV5IG5vIHB...
|
| It seems like many of them act like credit cards and charge the
| merchant a percentage, since they "drive consumption" and
| encourage people to buy stuff. Of course, this fee will likely
| be added into the price that all consumers pay, so as these get
| bigger, we all will be subsidizing interest free loans to
| people in the form of 1%-3% higher prices. Much like credit
| cards are today.
| pastor_bob wrote:
| making buying higher priced items easier to stomach. This is
| clearly targeted to people with good credit.
| SkyPuncher wrote:
| > This is clearly targeted to people with good credit.
|
| The commercials for Apple Pay have me thinking the exact
| opposite.
|
| * People with good credit don't need to manage their monthly
| credit payment. They simply pay it all off.
|
| * People with good credit also don't really need to apply for
| an emergency credit card (unless they happen to forget their
| wallet).
|
| My impression is many of these products are akin to loan
| sharks. They loose/break even on "good" borrowers, but make
| loads on people who are "so close" to being able to fully
| repay.
| scrollaway wrote:
| It makes products more "affordable" (emphasis on the quotes) by
| spreading the payment for them over multiple salary cycles.
| That TV you didn't buy because you couldn't afford it? You told
| yourself you don't need it, but now that you can mechanically
| pay for it, you "need" it so you'll buy it.
|
| It also allows the sellers to increase their prices or even
| simply upsell without pricing out their own consumer base.
| abudabi123 wrote:
| Capitalist cannibalisation a level-up from Amazon's pets and
| cattle categorisation on the fair-game userbase? Accounting
| minded players game the system to their benefit maximising
| purchasing power on credit over a timespan.
| keiferski wrote:
| This business practice seems to have become popular lately. It
| really gives me a bad feeling, probably because the idea of
| getting your customers into debt (to your own company) in order
| to buy your products just seems _wrong_ at a fundamental level. I
| don 't want to live in a world where everything is either rented
| or paid for with a loan.
|
| I can obviously understand why it makes sense from a strictly
| money point of view, but what is the business strategy against
| this? All I can think of is pushing a brand message that is
| explicitly anti-debt and builds its reputation on treating its
| community of customers well.
| logicalmonster wrote:
| This seems like a logical and interesting service that should
| drive quite a few sales for Apple as people impulse-buy status
| symbols they shouldn't really try to afford.
|
| My big concern with using some of these "pay later" types of
| services is that it seems incredibly risky to your credit score
| even if you do everything right and pay it off on time.
|
| If Apple or anybody else can clarify on this point, that would be
| great. Otherwise, I'd never touch this.
| jpollock wrote:
| They typically don't pull a credit score, or register a loan.
| They try to maintain a continuous auth for the next month's
| payment.
|
| That essentially lowers your credit card limit by the payment
| amount for the lifetime of the loan.
|
| If any single payment fails, they will then try and go for the
| remainder.
| logicalmonster wrote:
| I don't think a credit pull is the biggest concern here.
|
| Couldn't using this reduce the average age of your accounts,
| which is a big factor in credit score calculation?
| jpollock wrote:
| It doesn't register a loan, so there's no new account to
| affect credit score?
| logicalmonster wrote:
| You used the word "typically" in the last post, which
| isn't a very precise or confidence inducing word when
| dealing with something important to your life.
| twblalock wrote:
| The only thing that reduces the average age of your
| accounts is opening _new accounts_ or closing old ones.
| imtig3rman wrote:
| Apple using its cash surplus to slowly become a bank.
| scottyah wrote:
| This is Warren Buffet's forte, allocating massive amounts of
| capital. Since Apple is his first/only tech company, I wonder
| if he's playing a part in this.
| shagie wrote:
| This is a traditional path for many large companies.
|
| https://en.wikipedia.org/wiki/Ford_Motor_Credit_Company
|
| https://en.wikipedia.org/wiki/Discover_Card
| comte7092 wrote:
| They're partnering with Goldman Sachs, as they have in the
| past. Goldman is providing the actual banking services.
| zyang wrote:
| "The fruit bank will have its due".
| hulitu wrote:
| Wow. I can finaly afford an iPhone 14 Pro. /s
|
| Oh lord won't you buy me a Mercedes-Benz. My friends all drive
| Porsches, i must make amends...
| judge2020 wrote:
| Is there some sort of insurmountable tech debt over at Apple that
| requires these slow rollouts and long development cycles? They
| announced Pay later at WWDC 2022, and it's just now releasing,
| and the Savings account was announced in October and would be
| available "in the coming months", but is only just now (likely)
| coming out - and given Pay Later is still limited release, I
| imagine the savings account feature will be as well.
| CharlieDigital wrote:
| It probably has less to do with tech and more to do with
| regulatory, legal, support structure, and process design.
| bakugo wrote:
| I will never understand this obsession Americans have with debt.
| [deleted]
| scottyah wrote:
| A dollar today is worth more than a dollar tomorrow. Pair that
| with American Optimism and trusting the Fed, debt just makes
| sense. It's basically temporal arbitrage.
| imwithstoopid wrote:
| https://www.imf.org/external/datamapper/HH_LS@GDD/CAN/GBR/US...
|
| USA is bad but not the worst, this is a global plague
| armatav wrote:
| Funny how more debt is green in this IMF chart.
| jahewson wrote:
| China is almost as bad and Norway and Sweden are worse.
| Basically, if you have lots of money, you have access to lots
| of credit.
| rootusrootus wrote:
| I still don't understand this obsession everyone else has with
| finding reasons to criticize Americans. _Especially_ when it 's
| frequently based on ignorance.
|
| The other reply to your comment is pretty instructive. There
| appears to be a positive correlation between how wealthy a
| country is and how high the household debt load is.
| gnicholas wrote:
| I've never used a BNPL service, partly because I didn't know if
| it would complicate the process of returns. Does anyone know if
| there are complications, for example, if you buy two items and
| return one of them? Does the merchant give you cash that you then
| end up using to pay off the full BNPL amount? Or does the refund
| get routed the other way, to the BNPL service, and then
| eventually to you?
|
| For users of a reward card, this alternative probably isn't that
| useful. I'd miss out on 2% cash back, and the zero-interest
| period is only 6 weeks, which is just a couple weeks longer than
| the zero-interest period on a credit card (which bills you once a
| month, effectively giving you 0-4 weeks of zero-interest). I can
| see how it could be good for younger folks who need to build up
| credit and can use this to do so responsibly.
| umeshunni wrote:
| > Apple Pay users can split purchases into four payments with
| zero interest and no fees
|
| What's the business model for all these BNPL companies if they
| have zero fees and zero APR?
|
| Are they counting on some % of users requiring extensions?
|
| Are they getting a % of transaction value as fees?
| pb7 wrote:
| Increasing sales by reducing the obstacle of not having all of
| the money now.
| [deleted]
| [deleted]
| djhworld wrote:
| retailer likes it because it increases prospect of sale + it
| incentivises people to add more things to their basket
| jstanley wrote:
| > Are they getting a % of transaction value as fees?
|
| Yes, this. And it's worth it for the merchant because they make
| more sales. patio11 has a good article about it:
| https://www.bitsaboutmoney.com/archive/buy-now-pay-later/
| [deleted]
| okdood64 wrote:
| Affirm charges merchants a fee for sales.
| GeneralAntilles wrote:
| The merchant pays at least double the rate compared to a normal
| credit card transaction fees. Merchant pays more for the
| payment processing and gets better conversion.
|
| https://www.bitsaboutmoney.com/archive/buy-now-pay-later/
| lotsofpulp wrote:
| But Apple BNPL applies to all merchants that accept Apple
| Pay. I cannot imagine that Target/Albertsons/Trader
| Joes/Costco/etc agreed to pay an extra 3% in payment
| processing fees if their customer chooses to use Apple BNPL.
| coolspot wrote:
| Apple is taking the fee from cash back % (2% on
| everything).
|
| Amazon does the same - you can buy a thing with 0% APR in 6
| monthly payments, but you lose your Amazon card 5% cash
| back.
| lotsofpulp wrote:
| I am referring to this line in the bitsaboutmoney.com
| article:
|
| >BNPLs pitch themselves to businesses as more marketing
| efforts and less simple payments rails. They're more
| expensive than cards by about 300 bps.
|
| I assume this is all the same as Goldman Sachs' Apple
| credit card. The same payment fees from merchant to
| Goldman Sachs, and then Apple might get a little too.
| Since Goldman is taking all the underwriting risk, I
| would be surprised if Apple is getting the lions' share.
|
| Apple's reward is their devices becoming more popular
| among people who cannot get credit cards and might find
| utility in Apple BNPL.
| jankassens wrote:
| I understand this is instead of the 2% cash back that Apple
| Card pays on full payments.
|
| I assume the merchant fees are the same either way.
| rootusrootus wrote:
| > I understand this is instead of the 2% cash back that Apple
| Card pays on full payments.
|
| That would reduce the appeal a little. And that's different
| than their own-store policy on their card -- if you buy from
| Apple with an Apple Card on the installment plan, you get the
| 0% for 12 months or whatever, and you get the 3% cash back
| too.
|
| Thanks for the 2% comment, by the way. Made me go look, since
| I only recall it being 1% (for most things). Turns out it's
| 2% whenever I use my Apple Watch to do the transaction. Works
| for me!
| boplicity wrote:
| Transaction fees charged to merchants for these types of
| payments can be as high as 10%. That's pretty substantial.
| lotsofpulp wrote:
| I do not think Apple negotiated with every merchant that
| accepts Apple Pay for a higher fee for Apple BNPL payment.
| The fact that any Apple Pay transaction qualifies makes me
| think the regular payment processing fee for a credit card is
| what Goldman Sachs/Apple get.
| dualboot wrote:
| Lots of answers here but for the merchant it's an alternative
| to a "sale price" to drive a transaction.
| neets wrote:
| At what point does apple become a state in and of its own right?
| gumby wrote:
| Feels to me that something like this cheapens Apple's brand.
|
| I don't mean to imply that they had an expensive brand and this
| changes the demographic (I hate businesses like that), I mean
| their brand, as far as I can tell, is "high quality, thought
| through, and works well".* This feels like they are exploiting
| their existing customer base.
|
| * Pls don't argue if you disagree on the actual quality or
| whatever. This is about how it looks to me that they position
| themselves. Feel free to argue about how they might be
| positioning themselves :-)
| keiferski wrote:
| I agree completely. Maybe it's just nostalgia, but I really
| cannot imagine Apple doing this under Steve Jobs' management.
| He would have rejected it simply for seeming tacky and
| reminiscent of products in low quality industries.
| gumby wrote:
| The original Mac, in 1984, was offered with a financing
| package because it was so expensive. And yes, that was when
| Steve Jobs worked for apple.
| DavidPeiffer wrote:
| I was thinking the same thing. My understanding was prior to
| iPhone, phones were purchased outright, typically costing a
| couple hundred dollars, and there wasn't such a thing as
| paying off the phone as part of your monthly cell phone bill.
|
| I have always purchased my phones outright, but am curious if
| there are fees, interest, or a higher total cost of payments
| via financing (fees and interest on missed payments).
|
| That's the only justification I could use to say "maybe Steve
| would be good with it".
| babypuncher wrote:
| > I was thinking the same thing. My understanding was prior
| to iPhone, phones were purchased outright, typically
| costing a couple hundred dollars, and there wasn't such a
| thing as paying off the phone as part of your monthly cell
| phone bill.
|
| This was absolutely a thing before the iPhone. Many
| carriers offered Blackberries, Palm Treos, and even higher
| end dumbphones and featurephones at discounts when you
| signed a service contract.
| hot_gril wrote:
| They already cheapened their brand beyond this when they
| created a credit card. CC is another form of BNPL, but more
| importantly, it's the most gimmicky business out there.
| sithadmin wrote:
| This is nothing new. Apple's been in the BNPL finance game
| since the original iMac was introduced - so if they're
| tarnishing the brand, they've been doing it since they
| completely rebooted the brand.
|
| In 1998, you could finance a G3 iMac with a loan for ~70
| months of $29 payments. They also started up a store-only
| credit card finance option sometime in the early aughts via
| Barclays.
| hot_gril wrote:
| I'm aware that they've always offered financing, as many
| do, but it wasn't branded as a product like the Apple Card
| is. The product was the iMac. This time, the product is the
| card itself, complete with a brand name and heavy
| advertising. They're likening themselves to Citibank or
| Walmart.
| lotsofpulp wrote:
| They did not create a credit card. Goldman Sachs (GS) does
| all the financial work, and gives Apple a cut for the
| branding.
|
| Same thing here. GS is doing the underwriting, Apple is just
| providing the tech to be able to access the customer at the
| point of sale and make a split second automated offer for GS
| to lend money.
|
| Edit: I was wrong about GS doing the underwriting. The
| website states:
|
| >Apple Pay Later is offered by Apple Financing LLC, a
| subsidiary of Apple Inc., which is responsible for credit
| assessment and lending. Apple Financing plans to report Apple
| Pay Later loans to U.S. credit bureaus starting this fall,5
| so they are reflected in users' overall financial profiles
| and can help promote responsible lending for both the lender
| and the borrower.
| hot_gril wrote:
| We're talking about branding. Apple is the one selling the
| card to customers, so it's their brand at stake, not GS's.
| sithadmin wrote:
| Branded financing options have nothing to do with brand
| prestige. Luxury car brands do it. High fashion houses do
| it. High street department stores have been doing it
| longer than either of us have been alive. It doesn't turn
| anyone off to a brand.
| lotsofpulp wrote:
| Basically every single retail business brands a credit
| card. What difference would it make? Every airline,
| hotel, and retail store offers their own branded cc. Even
| Costco does, and that is about as high of brand
| reputation as you can get.
| hot_gril wrote:
| Yes, exactly. Those aren't seen as tech companies. Apple
| has cheapened their brand to that of an airline or hotel,
| or Costco at best. It's not terrible, but it's not the
| visionary company it used to be.
| varenc wrote:
| My take is that the real business opportunity for Apple
| here is fraud reduction, not just the Apple branding.
|
| The biggest cost to any credit card provider is fraud,
| which they have to cover. Credit card fraud is $100B+/year.
| The Apple Card requires an iPhone and by leveraging iOS
| they can cut down on fraud. This lets them negotiate a
| better cut of the revenue from Goldman Sachs.
|
| I suspect the iPhone integration even cuts down on fraud
| when you use the physical Apple Card directly. Leveraging
| location and activity data from your paired iPhone/Apple ID
| probably gives them many useful signals for fraud
| prevention. And you'll notice that Apple seems to have
| extra logic for detecting jailbroken iPhones when you try
| to sign up for the Apple Card or add it to your wallet.
| (App Store and various other Apple services still work, but
| not the wallet/Apple Card related features when jailbroken)
| hot_gril wrote:
| Apple Pay also reduces fraud, but it costs the user the
| same in the end. Maybe they're making money this way.
| varenc wrote:
| See my other comment, but I just read that when you use
| Apple Card + Apple Pay together they give you 2% cash
| back. To me this really seems like more evidence that the
| fraud prevention of Apple Card + Apple Pay works well
| enough they can make this offering.
| hot_gril wrote:
| 2% is the same or a bit less than what other cards would
| give you.
| lotsofpulp wrote:
| Maybe, but I think if that were really the case, they
| would have at least offered 2% cash back on all purchases
| to be competitive with other credit cards. That is the
| baseline free credit card that anyone credit card worthy
| can get.
| varenc wrote:
| Apple Card does offer 2% cash back on all purchases! But
| only when you pay use an Apple Card via Apple Pay, not
| when you pay with the physical card. I suspect this is
| because when Apple Pay is used they have particularly
| good fraud prevention allowing them to offer this in that
| case.
| lotsofpulp wrote:
| Lots of other cards give 2% cash back without Apple Pay
| and Apple's advantages in fraud prevention, so I would
| expect Apple to be able to offer even more cash back if
| they wanted to attract other credit card users.
| bradgessler wrote:
| Something to think about: if for whatever reason you can't pay
| Apple, they will disable your iCloud account.
|
| https://dcurt.is/apple-card-can-disable-your-icloud-account
|
| I refuse to get an Apple Card until they firewall the two and
| make them independent of each other.
| jeffy90 wrote:
| I've been loving apple card. I love that the rewards come in
| cash rather than airline points, so it's really easy to use the
| rewards.
| bdcravens wrote:
| A number of other credit cards do that as well (Capital One
| and Discover are the ones I've personally experienced)
| JumpCrisscross wrote:
| From the linked article [1]:
|
| "...my bank account number changed in January, causing Apple
| Card autopay to fail. Then the Apple Store made a charge on the
| card. Less than fifteen days after that, my App Store, iCloud,
| Apple Music, and Apple ID accounts had all been disabled by
| Apple Card."
|
| Wouldn't the same thing have happened if he didn't have an
| Apple Card, but instead had his credit card decline not only on
| their Apple subscriptions, but also the MacBook they traded in?
|
| [1] https://dcurt.is/apple-card-can-disable-your-icloud-account
| bradgessler wrote:
| Not sure, but that's a good point.
| notesinthefield wrote:
| At what point is a situation so convoluted that it can be
| considered an edge case? Because this story seems like it
| would qualify! Not only did someone's bank account number
| change without intervention but it seems Apple also got
| something wrong about the purchase on two different occasions
| (saying OP bought an iphone, not a macbook and applying the
| trade-in to their card without confirmation)...I take your
| point. But, wow.
|
| Im frankly surprised AC works this way, all of my
| interactions with AC support and Apple makesit seem like one
| wants nothing to do with the other.
| JumpCrisscross wrote:
| > _did someone 's bank account number change without
| intervention_
|
| Their bank account number changed for reasons unrelated to
| Apple. That caused their Apple Card monthly payment to
| fail. Which caused their payments to Apple, for
| subscriptions and a trade-in, to fail. So Apple cancelled
| their subscriptions.
|
| Agree the support communication on iPhone versus MacBook is
| imprecise. But nothing indicates Apple acted improperly or
| in a manner they wouldn't with anyone else failing to pay
| for their services.
| pitterpatter wrote:
| At Apple's scale, an edge case is a question of when (and
| how often) not if.
| ben0x539 wrote:
| > At what point is a situation so convoluted that it can be
| considered an edge case?
|
| People have edge cases all the time! Failing gracefully in
| edge cases is a critical feature for anything that's so
| deeply wired into your life like a payment processor or a
| cloud account!
| efsavage wrote:
| He paid his iCloud with his Apple Card, but didn't pay the
| credit card bill properly, so they basically clawed back the
| purchase.
|
| The analogy is that if I pay for Netflix with Amex and miss
| an Amex payment, they can't directly cancel Netflix.
| Eventually if I continute to not pay, they'll shut down the
| card and Netflix won't be able to charge and will then cancel
| themselves, but that's a much more flexible process.
|
| It's always good to have a few "fire breaks" between your
| most important accounts (email, payments, domains, etc.).
| WirelessGigabit wrote:
| Well, no, if the credit card charge is declined they don't
| offer the service.
|
| They don't owe you anything if the charge fails. So no-one
| loses.
|
| If they charge your bank account for a credit card bill that
| you owe, and it fails, they lose.
| joshmanders wrote:
| On the flip side since most people like to share scary stuff
| because when things are going right, nothing is worth
| sharing...
|
| I put 75k or more worth of transactions through my Apple Card
| in 2022 and I've had nothing but wonderful experiences with the
| whole thing, including with Apple and Goldman Sachs.
| itsoktocry wrote:
| "wonderful experiences"?
|
| It's a credit card. You tap it and pay for stuff...
| stuff4ben wrote:
| Same. I use my Apple Card instead of cash or my debit card in
| almost all cases (except Costco where I have to use Visa and
| I have their card for that). I've averaged a little over
| $27K/year since 2019 and have had zero issues. GS has been
| great when I've had to dispute charges and they took care of
| everything. I love how seamless it is and it just works.
| Also, I am a self-admitted Apple-whore and am totally
| invested in their ecosystem FWIW.
| judge2020 wrote:
| > except Costco where I have to use Visa and I have their
| card for that
|
| I imagine this is due to some dispute with Mastercard on
| their fees for credit cards (you can use MC debit at
| Costco); Visa probably gives Costco a steep discount on
| fees.
| dragonwriter wrote:
| > I imagine this is due to some dispute with Mastercard
| on their fees for credit cards
|
| Costco has long had an official credit card and only
| allowed cards of that brand (whether theirs or not), for
| a long time it was Amex not Visa.
|
| > Visa probably gives Costco a steep discount on fees.
|
| Right; their single-card-brand partnership agreement is a
| tool for getting lower credit card processing fees.
| judge2020 wrote:
| > Right; their single-card-brand partnership agreement is
| a tool for getting lower credit card processing fees.
|
| Volume rates in general are extremely common.
| dragonwriter wrote:
| > Volume rates in general are extremely common.
|
| This combines "volume" with "exclude our competitors".
| judge2020 wrote:
| My point (theory) is that Mastercard isn't offering them
| a big enough volume discount. If they could pay 0.1% I
| doubt they would exclude MC even if it meant losing out
| on some Costco credit card accounts.
| dragonwriter wrote:
| I'm saying excluding other card brands gets them a bigger
| discount from their exclusive card network than volume
| alone would, not that it pushes people to the Costco-
| branded card from that network (though it probably does
| that, too.)
| poly_morphis wrote:
| In Canada, I believe you can only use Mastercard at
| Costco, interestingly.
| sneak wrote:
| I closed my Apple card account when Apple refused to stop
| deadnaming me on it without court documents.
|
| AmEx et al never disrespected me thus.
| wintermutestwin wrote:
| You must not need to download those transactions as a CSV
| file. You can only pull it down one statement at a time!
|
| Thanks Apple for making tax time just a bit more painful...
| jwineinger wrote:
| this horror alone is enough to make me avoid it.
| Reconciling transactions with my budget software is hard
| enough
| Aunche wrote:
| The Apple Card is great because Goldman decided to get in the
| business of selling two dollar bills for a dollar as a growth
| hack. That's not something that will last forever.
| judge2020 wrote:
| What do you mean? In the US where Apple Card is offered,
| the 2% back for Apple Pay transactions seems sustainable.
| The only thing that has put GS into question is [0], but
| that's just overlending likely at the request of Apple to
| get Apple Card in more hands.
|
| 0: https://9to5mac.com/2023/02/16/apple-card-future-
| goldmans-sa...
| shagie wrote:
| They're alluding to the cost of acquiring a customer for
| GS through Apple Card.
|
| https://appleinsider.com/articles/23/01/18/apple-card-is-
| a-d...
|
| > Goldman Sachs spent a lot of money to help launch Apple
| Card and its other consumer services. A report from
| January 13 revealed the bank's consumer credit division
| lost $1.2 billion in nine months last year, and the
| losses were primarily related to the Apple Card.
|
| > "In the consumer platforms, we did some things right.
| We didn't execute on some others," Solomon told CNBC on
| Wednesday. "We probably took on more than we should have,
| you know, too much, too quickly."
|
| > Goldman helped launch the Apple Card in 2019 and
| reportedly spent roughly $350 to acquire every new Apple
| Card customer. And in 2022, it scaled back its efforts to
| turn its consumer savings business, Marcus, into a fully-
| fledged digital bank.
|
| > Executives of Goldman's collection of businesses known
| as Platform Solutions believe its consumer division may
| break even in 2025, although that target was initially by
| the end of 2022. However, the bank isn't giving up on the
| Apple Card.
|
| > "I think we now have a very good deposits business,"
| Solomon said. "We're working on our cards platform, and I
| think the partnership with Apple is going to pay
| meaningful dividends for the firm."
| euroderf wrote:
| Just "disable" ? At what point do they toss your data in the
| trash ?
| commoner wrote:
| For US residents, the Apple Card is not a competitive credit
| card. There are enough credit cards with no annual fees
| offering at least 2% cash back on all purchases that the Apple
| Card's 1% back on general purchases is not a good value. Just
| about every credit card issuer in the US supports Apple Pay as
| well, allowing these 2% cash back cards to match the Apple
| Card's 2% on Apple Pay purchases.
| twostorytower wrote:
| It's 2% back anytime you use Apple Pay, though. Which I use,
| a lot, and it's nice not to think about which card to use in
| that scenario, which I imagine was their point. I know there
| are plenty of cards that will give 2% cash back on any
| transaction, too.
| tempsy wrote:
| getting 3% back on apple purchases plus 0% interest for 12-24
| months is pretty nice.
|
| given theres no annual fee i don't really see the downside if
| you buy apple products.
| meinheld111 wrote:
| https://news.ycombinator.com/item?id=35344441
| pwinnski wrote:
| That didn't seem to have anything do with it being an
| Apple card, though?
| driscoll42 wrote:
| It's not bad for using to buy Apple Products, but if you're
| only using one credit card, might as well get something
| that gives 2% on all purchases unless you reallllly buy a
| lot of Apple products.
| tempsy wrote:
| at this point getting a 0% loan for 2 years is more
| interesting than the difference between 1-2% cash back.
|
| i used to be really into optimizing cash back but it just
| ends up costing more mindshare than it is really worth.
| bombcar wrote:
| That's exactly the goal of the companies, and Apple's
| offering is "good enough" there.
| pwinnski wrote:
| People keep saying things like this, and rarely offer up the
| name of any better card when asked.
|
| Apple Card offers 2% cash back on all Apple Pay purchases,
| which... exactly matches my no-fee card from Chase. Except I
| have to choose how to use the 2% from Chase when it
| eventually is available, while I can spend Apple's 2% the
| next day via Apple pay. I threw the metal card in a drawer
| when it arrived, so if your goal is tell people not to use
| the physical card, then sure, I'm with you. But I don't think
| that's the primary use of the card.
| [deleted]
| invisible wrote:
| Apple Card is very convenient, but it's not the best in the
| rewards arena.
|
| For example, CapitalOne SavorOne (3% for many categories)
| and Wells Fargo Active Cash (2% on all purchases). There
| are many others that are competitive for specific
| situations though, including Citi Custom Cash (5% in a
| single category). Most of these cards also offer an intro
| APR and/or bonus after $X has been spent.
| ls612 wrote:
| Fidelity Investments credit card has blanket 2% cash back
| on everything and supports Apple Pay, to name one.
| dpkirchner wrote:
| I have a Chase Amazon Visa card that gives 5% back on
| Amazon purchases and some % on the rest. I happen to buy a
| lot from them (although less and less as I see more
| counterfeit-looking brands).
| wintermutestwin wrote:
| This card also has no foreign transaction fees.
| jibe wrote:
| It also covers Whole Foods which is nice if you shop
| there.
| davchana wrote:
| My Goto card is Paypal 2% for everything, and 3% for PayPal
| (so online Walmart, ebay, anything which offers PayPal), as
| soon as txn goes through. Synchrony Bank's own mastercard
| also offers 2% on everything, at every statement end. Wells
| Fargo Active Cash also offera 2% everywhere. I use Wells
| Fargo Autograph for 3% stuff like Travel, Food. Discover &
| Chase come out only if there are 5% offers or categories.
| Capital Ones get only 99 cent charge a month to get it
| forgiven.
|
| Apple card only for apple purchases, 0% apr && 3% cashback.
| I use android phone, so no apple pay possible. I wish it
| allows to be added to google pay with nfc.
| mulmen wrote:
| I never redeem points for purchases. I always apply them to
| a billing credit. If you redeem points for a purchase you
| don't accrue points on that purchase.
|
| Chase of course goes out of their way to make this as
| painful as possible. Currently their app is broken and
| points can't be redeemed for cash. There is also no way to
| automatically apply all points to a statement credit. My
| perception that this is the best use of points is
| reinforced by how much effort they put into trying to
| convince me to do something else.
| throwaway09223 wrote:
| "and rarely offer up the name of any better card when
| asked."
|
| Huh? This is public and searchable information. Even
| ChatGPT 3.5 can give you a comprehensive answer to "what
| are the best cash back credit cards?"
|
| It seems like your complaint is that people aren't
| answering a trivial question. This isn't a valid
| argumentative position.
|
| The apple card's terms are definitely sub-par. Double the
| cash back would be competitive with say:
| https://www.fidelity.com/cash-management/visa-signature-
| card
|
| Cards that do 5% in special categories are also common.
| joemi wrote:
| To be fair, I've searched for this kind of thing before,
| and the results are usually plagued with so much
| sponsored content that it's hard to tell what's really a
| good deal and what's something someone's being paid to
| tell me is a good deal. (I feel this way about pretty
| much all financial advice online, for better or worse.)
| maratc wrote:
| > Even ChatGPT 3.5 can give you a comprehensive answer to
| "what are the best cash back credit cards?"
|
| Is this a new version of "google it"?
| fauxpause_ wrote:
| Yes, with Bing
| roland35 wrote:
| Fidelity has a flat 2% card which has no annual fee. The
| cash back then automatically transfers to my brokerage
| account where it immediately loses money in the stock
| market, so maybe it works out to less than 2% :)
|
| Citi also has a widely used cash back card for ~2%
| leetcrew wrote:
| it looks like the fidelity card cashback even exceeds 2%
| if you have a large brokerage account with them, which is
| cool. but it looks like you do need an active brokerage
| account with them to use the card at all. a good deal if
| you'd like to have a fidelity brokerage account anyway,
| but imo citi doublecash is the better general
| recommendation since it doesn't have the same cross-
| product dependency.
| kenhwang wrote:
| The Fidelity card really is a great general purpose low
| maintenance card. Plus, if your default cash position is
| SPAXX, it's currently earning 4.4% interest which isn't
| too shabby.
| symfoniq wrote:
| Wells Fargo, too.
| petilon wrote:
| Citibank double cash https://citicards.citi.com/usc/LPACA/C
| iti/Cards/DoubleCash/p...
| BiteCode_dev wrote:
| Does it mean your i-devices will stop working as well? At least
| the emails I assume, maybe imessages...
|
| If google shots down your account, you are out of docs,
| youtube, gmail... This can literally kill your career.
|
| Not to mentions all the "sign up with google/apple" you used.
| bradgessler wrote:
| I don't think so, but it's trending more in that direction as
| Apple spins up more services.
| toyg wrote:
| Apple apologists should probably work on replacing their "bUt
| GoOgLe!" routines, since people have largely moved on from
| the Google ecosystem as a whole - and in some cases, like
| this one, Google is not even present in the same market
| (credit cards).
| ezfe wrote:
| The linked post doesn't actually say "If you don't pay your
| credit card bill we disable your iTunes/iCloud"
|
| What it actually says is "If you don't pay your credit card
| bill, we decline new transactions since you're at your credit
| limit. If your iCloud uses your Apple Card and that
| transaction is declined, then your iCloud may be disabled."
| WC3w6pXxgGd wrote:
| [dead]
| annexrichmond wrote:
| > Apple Pay Later allows users to split purchases into four
| payments, spread over six weeks
|
| So you basically have to start paying early, every 1.5 weeks.
| This seems worse than credit cards where you don't have to pay it
| up to like 60 days later.
|
| It also seems strictly worse for users than other BNPL's like
| Affirm where many purchases can be paid over the coarse of
| several months or years.
| roody15 wrote:
| Yuck my two cents. Apples jump into financial services and pay as
| you go services model has really rubbed me the wrong way. If i
| get another settings alert that I need to setup apple wallet,
| sign into icloud or now perhaps a notice that I can "pay later"
| ...... geez I already purchased you laptop ... leave me alone and
| just work.
| suresk wrote:
| My favorite part of all these "buy now pay later" services is
| going to buy some charging cables, a few bags of flour, or other
| small random stuff and being offered to split a $19 purchase into
| 4 equal payments.
| kruuuder wrote:
| Feels like Apple is more and more seduced/mesmerized by the
| opportunity to provide random consumer services that promise
| large revenues. Why add yet another new product to your portfolio
| when you're still struggling so much with software quality?
| azemetre wrote:
| Because companies don't get punished for poor software quality,
| if they did Oracle would cease to exist.
| geodel wrote:
| I'd say Slack, but it seems very popular with cool crowd.
| kimbernator wrote:
| It's got issues but when the other big option is Teams,
| there's not a lot of room for complaining
| pphysch wrote:
| How easy do these deferred payment systems make it to manage the
| cognitive load of such volatile "long-term" payments? Do people
| just set up autopay?
|
| Having a set of monthly rent/utility costs is fine, cause they
| aren't particularly volatile.
|
| Credit card microloans are also fine because they are all managed
| under 1 balance.
| squeaky-clean wrote:
| I can't find information on how Apple will specifically
| implement it, but Sweetwater has a similar thing (they're a
| music gear shop) and it's auto-billed. You're essentially
| signing up for a 3 or 6 month subscription service where the
| monthly bill is 1/3 or 1/6 of the total cost of goods.
| latchkey wrote:
| Responsible lending is providing collateral and then taking out a
| loan against that collateral. Don't spend what you don't have.
| This is not that.
| ape4 wrote:
| Another Apple "invention" that was all ready invented decades
| ago.
| rykuno wrote:
| Why are people upset about this? Huge win for the _responsible_
| consumer. If something is 0% interest, its free money.
| pythko wrote:
| It's free to end consumer, but these schemes make money by
| charging a percentage to merchants. And those merchants will
| compensate by bumping up their prices a little to cover the
| transaction costs.
|
| In the best case, these are pointless services that only
| transfer money to the finance industry. In the worst case, they
| incentivize people to spend money on things they can't afford
| (and also transfer money to the finance industry).
| zeroonetwothree wrote:
| Credit cards already let you pay for stuff up to 60 days later
| with 0% interest. This new service is shorter term than that.
| not_your_vase wrote:
| Responsible people have already a lot of easy choices for short
| term free money. Banks almost literally throw credit cards at
| people, with 45-60 days without any charge (and even with
| cashback) - assuming that you can afford it.
|
| BNPL usually don't target these people.
| rootusrootus wrote:
| My guess - people think it is fooling unsophisticated customers
| into making poor financial choices and buying things they
| should know they can't afford.
|
| But I'm with you, I don't see it as a big deal. I routinely
| take advantage of the 'no interest installment plan' for my
| Apple toy purchases on my Apple card. Why _wouldn 't_ I want to
| hold off on giving them my money for as long as possible,
| especially in an inflationary environment?
| BenSahar wrote:
| Even outside the current inflationary period, I like using
| no-interest financing to give myself the option of paying for
| something over time.
|
| I don't typically finance anything I can't afford to buy
| outright. I just like to feel like I have extra breathing
| room in the case of some emergency.
| kimbernator wrote:
| My credit card is 0% interest if I pay it off, and I get all
| sorts of benefits from it. Why would a responsible consumer use
| this over a credit card?
| gmd63 wrote:
| If a loan is 0% interest, I can guarantee you it comes with a
| price. And it's most likely paid by people who don't understand
| it.
| AVTizzle wrote:
| If you're short USD, I guess this makes all the sense in the
| world.
| acd wrote:
| What are the financial incentives for Aplle to providing this
| service for free? US interest rates currently being close to 5
| percent.
| SkyPuncher wrote:
| Likely a percentage of the transaction. In this case, a part of
| a larger transaction that people can now "afford".
| armchairhacker wrote:
| They should introduce "Apple Pay Never" and make it so I can just
| buy stuff without paying for it at all.
| sircastor wrote:
| Well, you wouldn't really be buying stuff at that point...
| imwithstoopid wrote:
| I hate this entire industry...Klarna, Affirm...now Apple BNPL
|
| sad that Apple has had to resort to "financializing" their own
| customer base
| AdamJacobMuller wrote:
| I saw one of these while checking out on Uber Eats recently.
|
| #1, no, I don't want to spread my $50 worth of sushi out over 4
| months
|
| #2, if you do need to do that, maybe you shouldn't be ordering
| from Uber eats?
|
| It seems extremely parasitical. I'm equally bothered that these
| companies are doing this and that some consumers feel the need
| to do this (and think this is a good idea)...
| shagie wrote:
| When I bought my Centris 650 in college, I bought it using a
| loan that was initially set up by Apple.
|
| I don't see anything surprising or new about this other than
| that Apple has an easier way of managing that loan than a book
| of paper that you ripped one out each month and sent it in
| along with a paper check.
| zitterbewegung wrote:
| iPhones have been financed and or given 0% loans by nearly
| every carrier and they have $51 billion dollars cash on hand.
| Providing their own loans makes sense regardless.
| MarkSweep wrote:
| Oh wow, they actually are doing their own loans instead of
| taking the usual route and having a bank provide the
| financing. From the press release:
|
| > Apple Pay Later is offered by Apple Financing LLC, a
| subsidiary of Apple Inc., which is responsible for credit
| assessment and lending.
| justinator wrote:
| I mean I had an Apple Loan for students way back in 2000 with
| an APR % that would have made me pay $8,000 for a 400mhz G4 had
| I followed their payment schedule...
| brundolf wrote:
| With "zero interest and no fees", what happens in these products
| if somebody falls behind, or even just decides not to pay?
| karaterobot wrote:
| Good question! I don't see anything about it, other than that
| it'll damage your credit history.
|
| To me this seems like a recipe for trouble, I'll stay away from
| it.
|
| There's also a part of my brain that jumps to: "if you missed a
| payment, would they just lock you out of your laptop by some
| remote command?", though there is no indication of this, and it
| seems unlikely (as of now).
| rootusrootus wrote:
| Same thing that happens when you refuse to pay your credit card
| bill, I assume. Annoying bill collectors, maybe a court
| judgement, and for sure a _dramatic_ cut in your credit score.
| hn_throwaway_99 wrote:
| Ahh, more "innovation" from the tech industry. So much BS that is
| easily a net negative to society.
|
| Saturday Night Live had it spot on years ago:
| https://youtu.be/R3ZJKN_5M44
| Ocerge wrote:
| My laptop died recently, and I went with an M2 MBP. I went in
| expecting to pay it in full, but with no interest/fees, why
| wouldn't I choose this? It beats inflation, even if only
| minimally.
|
| Seems predatory towards people who are buying stuff they can't
| afford, otherwise I don't see how they make money (minus the
| overpriced laptop I just bought, I guess).
| lm28469 wrote:
| Same reason I can eat a single donut and be fine while my best
| mate won't stop until the box is empty
|
| People make poor decisions, a lot of people make poor financial
| decisions, what is a great tool when you're educated is a
| catastrophe for others
|
| The new wave of "pay later" payment systems is clearly a way to
| artificially boost consumption in the short term
| __derek__ wrote:
| If you're in the US and have good credit, you can do better by
| opening a credit card with a 0% APR period for 12+ months in
| addition to a sign-up bonus (e.g., Chase Freedom Unlimited,
| Amex Blue Business Plus), although that takes a little more
| effort.
| Rimintil wrote:
| > Chase Freedom Unlimited
|
| > After the intro period, a variable APR of 19.49%-28.24%
|
| I suppose it isn't an issue if you pay your card off every
| month, but that's a high APR.
| __derek__ wrote:
| You don't need to pay it off every month during the intro
| APR period: pay the minimum for the first N statements,
| then pay the full balance, and you'll pay $0 in interest or
| fees.
| SoftTalker wrote:
| Just don't forget, because if you're late paying off the
| balance they will usually charge interest retroactive to
| the opening date of the account (not sure that is the
| case in this specific example).
| suresk wrote:
| It's always good to understand what the policy is on an
| offer like this, but most credit card intro rates are not
| like this - it is typically store charge accounts that
| offer "12 months same as cash" that accrue interest and
| add it if not repaid during the time offered.
| artificialLimbs wrote:
| "Hey Siri, set a reminder in 12 months to get a new
| credit card."
| __derek__ wrote:
| If one is worried about forgetting, this probably isn't a
| good hack, but it should be possible to (a) buy a T-bill
| or CD maturing near the balance due date and (b) use Bill
| Pay to schedule a payment for the balance due.
| bombcar wrote:
| Even if you pay everything each month the company makes
| 2-3% on you minus whatever cash back, which is 12-30+% a
| year on your monthly spend. You just don't see it directly.
| vineyardmike wrote:
| Remember, it beats inflation in a theoretical sense, but only
| if you actually will do something with the extra cash today. If
| your salary won't change during the loan, and you're not
| investing the money you didn't spend, then you're not realizing
| any gains against inflation. In fact, you're just giving
| yourself less money tomorrow, when inflation should make other
| goods more expensive.
| 535188B17C93743 wrote:
| Hypothetically, you could pop that money into a checking
| account with extremely marginal interest and still make
| money. Better in your pocket than Apple's, I guess.
| vineyardmike wrote:
| The $25 you might make from saving $1000 is, to me, not
| worth the cost of having a reoccurring debt to service.
| Especially in the face of layoffs etc. I suppose someone
| might say a monthly payment is preferable to less savings
| in that situation... so I guess the financing could work in
| your favor depending on your situation.
| r00fus wrote:
| My savings account makes 3.5% interest.
|
| My only catch is this loan requires a soft credit report - I
| have a freeze on most of my credit scores (used to be there
| were only 3 now there are a few more). Even a soft pull will
| hit that barrier.
| zamnos wrote:
| If you're not getting at least 4% on cash these days,
| you're doing yourself a disservice.
| r00fus wrote:
| Interesting - things are moving so fast. I see UFB gives
| 5.02% these days.
| SkyPuncher wrote:
| In that case, this is essentially just a credit card (without
| the benefits/protections).
|
| The use case here seems to be people who would not actually be
| able to pay this off in a month.
| lotsofpulp wrote:
| The use case is people who do not qualify for a traditional
| 2% cash back or equivalent credit card. Surely Apple does
| want people who can pay their Apple BNPL debt per the
| schedule.
| [deleted]
| 999900000999 wrote:
| It's very easy for this to push people into buying more than
| they need.
|
| 90% of people are fine with an M1 Air, the last time I went to
| an Apple store the sales clerk straight up refused to sell me
| one. He basically told me I didn't know what I was talking
| about and kept trying to sell me a pro.
|
| I asked him 3 times to sell me an Air, and ended up leaving in
| frustration. Not before he pitched buying a pro on an Apple
| line of credit instead.
|
| If I come into a store and tell you what I want to buy, we're
| not having a conversation. You have no idea what or who I'm
| buying it for.
|
| Best Buy doesn't do this, I was able to get my Air without an
| argument and walk out.
|
| If anything, this pay later stuff will make the issue worse.
| You'll go into the Apple store to be told you might as well get
| the most expensive thing they have in stock, it's zero down
| anyway!
| SoftTalker wrote:
| If you want to talk about what 90% of people are "fine" with,
| honestly it's a Chromebook.
|
| I have a Chromebook I bought in 2018 for something like $200,
| and it's "fine" for gmail, online banking, youtube, and other
| casual stuff. I have an ssh app on it to use for work, and
| that's "fine" as well. Most people don't need more than this.
| bombcar wrote:
| You can get a Chromebook for $149 today right now at
| Walmart.
|
| And a windows 11 craptop for $200. These things are
| absolutely completely insanely cheap.
| jeffy90 wrote:
| Do the apple sales people get commission? I seldom enjoy
| working with people looking to influence me to do something
| so that they can grow their comission.
| toyg wrote:
| They probably have targets. Everything they do is tracked,
| including sales they close.
| reaperducer wrote:
| _Do the apple sales people get commission?_
|
| It's been widely reported on the internet that Apple
| salespeople are not on commission, which is what makes the
| OP's story so curious.
|
| Maybe it's changed since the pandemic.
| Ancalagon wrote:
| Right? This story sounds sus to me. I've visited Apple
| stores so many times and literally never had a pushy
| salesperson.
| jshier wrote:
| They don't work on commission but they still have sales
| targets for attachments like AppleCare and, most likely,
| the credit card.
| joe5150 wrote:
| If I've gotten any kind of general attitude at all from
| Apple Store employees since the pandemic, it's mainly one
| of "Why are you here?" Maybe this employee wanted to take
| advantage of the rare opportunity to do something other
| than retrieving people's pick-up orders and actually try
| to _sell_ something, but this is deeply untypical for
| shopping at the Apple Store.
| wincy wrote:
| That's crazy! I use my M1 Air for everything and it's
| excellent. I would have asked to talk to his manager.
| 999900000999 wrote:
| Oh it gets better than that, I walked into the store and
| asked to buy a MacBook Air.
|
| The first clerk disappears, and some kid who is roughly 19
| starts lecturing me about how much better the pro is. I
| politely respond, I just want to buy the Air.
|
| He insists, 'well , do you want to make music '. I respond,
| 'please sell me the Air'. At this point he's not budging. I
| ask a final time, and ask why are you making this
| interaction so difficult.
|
| Him: 'well you're making it difficult'.
|
| I walk out and go to Best Buy. At Best Buy I simply asked
| to buy an Air, and I was out in 5 minutes.
|
| Now truth be told, if the kid would have told me he needs
| to push a certain number of pros per month, I might have
| said okay and brought one. But instead he decided to insult
| me, I even explained that as a software engineer I knew
| exactly what I was talking about. I shouldn't need to
| explain anything when I'm trying to buy a product, it's
| none of your business if I prefer an M1 air because I
| routinely dropped my laptops. If it's a gift for someone
| else, or in reality it does the job I need it to do.
|
| I'm legitimately never going into an Apple store again
| after this.
| yumraj wrote:
| Which country? US? I would have taken his/her name and
| asked to speak with the manager.
| HopenHeyHi wrote:
| > Now truth be told, if the kid would have told me he
| needs to push a certain number of pros per month, I might
| have said okay and brought one.
|
| Which is why they nag you. I don't really understand this
| mindset but there's no question it exists. And there's no
| question the paperclip machine will have its goddamn
| paperclips.
|
| Probably the 19yr old will eventually get turned into
| Solyent and replaced with a more polite/savvy version -
| and you will succumb and buy a pro you don't need just to
| be nice. And numbers will tick upwards.
| johnmaguire wrote:
| Well, do be aware... I don't think that Best Buy
| _technically_ pays commissions based on sales, but they
| do often have reps from brands around who will try to
| sell you heavily on their product (e.g. Samsung reps.)
|
| I've also heard stories that while you won't get a
| commission, you may get more perks at work for higher
| sales numbers.
|
| In any case, your experience at Apple sounds insane.
| 999900000999 wrote:
| Best Buy isn't perfect, but in general they're much
| lighter on the 'advice' they try to give you. Their
| commission is in selling useless warranties, if a clerk
| does a good job I'll buy one as a tip.
| pwinnski wrote:
| That is shocking to me, and you'd be doing everybody else
| a favor if you let the store know about it, so that guy
| can be terminated or at least retrained. I've never had
| an experience anything like that, and I know that's not
| the norm at Apple stores. Wow!
| Tarsul wrote:
| Maybe the clerk was just a bad apple?
| mgkimsal wrote:
| What's weirder about this is that... most 'pros' really
| need more than stock stuff you can get at a retail store
| anyway. If you _need_ an M2 MBP, you probably want it to
| be 64g or 96g, and probably want 2tb storage. I 've never
| seen anything but stock/base configurations at retail
| stores (best buy, apple, etc). Perhaps they occasionally
| have variations? Or the stores I've been to are just...
| lower on the priority list for top-end configurations?
| tnel77 wrote:
| I get trying to upsell you, but why would you turn down a
| sale? Make the suggestion and then let the customer purchase
| whatever they want. A sale is a sale, no?
| bombcar wrote:
| Imagine the commission (not saying it's such) is $0 on the
| base model and $199 on the top end.
|
| Why bother giving the customer what they want if there's
| any chance they'd jump for the big one?
| kzrdude wrote:
| This representative is just tanking Apple's reputation
| for his own gain, that's what it looks like from the
| outside.
| gnicholas wrote:
| It only applies up to $1,000, and if you used an Apple Card
| you'd get 3% back on your purchase. If your purchase happened
| at the beginning of your credit card month, you'd also get 4
| weeks of free float, versus the 6 weeks you get here. Doesn't
| seem like an amazing deal, if a reward credit card is an
| option, and assuming they'd give you the same thousand dollars
| of credit.
| babypuncher wrote:
| Apple Card has had BNPL for Apple Store purchases for a
| while, and it's not subject to the $1,000 limit that this new
| service is.
| Ductapemaster wrote:
| I think the OP is referring to the financing options
| available for larger hardware purchases, which is separate
| from this program.
|
| I bought my M1 MBP using the financing they offer and it was
| 24 months, no interest, _and_ you do get the 3% back
| immediately upon purchase. They also set up the payment plan
| for you so you do not have to worry about missing a payment
| and getting charged interest you were intentionally avoiding.
|
| It's a great option if you are on top of your finances, but
| the point remains that it can easily be used to live outside
| of your means.
| basch wrote:
| Isn't max credit card float closer to 7 weeks? If you buy
| something the day after statement close, it takes 4 weeksish
| to issue another statement, and is due in another 3 weeks.
| Obviously if you bought at the wrong time in the cycle, the
| day before statement close, your float can be as little as 3
| weeks.
| gnicholas wrote:
| Yeah, good point, although this will vary. And the six
| weeks you get from Apple Pay is only on the last payment.
| hammock wrote:
| When you do BNPL you forgo the credit card rewards you would
| otherwise get, which can easily be valued at 3-5% of the
| purchase (I.e. more than the benefit of taking the free credit)
| imwithstoopid wrote:
| you probably aren't the target
|
| the target is uneducated (in the financial sense) consumers who
| are enticed into making purchases they might otherwise not make
| (and probably shouldn't make)
|
| Apple probably wants to get at the consumers who are still
| buying cheap Android phones who will be bowled over by the
| psychology of splitting the purchase price into installments
| pastor_bob wrote:
| > Users will be asked to link a debit card from Wallet as their
| loan repayment method; to help prevent users from taking on more
| debt to pay back loans, credit cards will not be accepted.
|
| So in addition to the soft pull requirement, it's clear this is
| almost exclusively targeted at people with good finances.
|
| Not being able to use a credit card is a huger bummer though.
| Buying something like a macbook pro is a decent way to meet the
| minimum on a credit card with a signup bonus if you're not a high
| rolling spender normally.
| WirelessGigabit wrote:
| The problem is that you cannot pay debt with a credit card.
|
| Same way like you cannot pay your mortgage with a credit card.
| dcchambers wrote:
| One of the most valuable life lessons my parents ever taught me
| was "If you can't afford it now, you can't afford it at all."
|
| YES, there is a time and place for financing (especially when
| interest rates were near zero and you have good impulse control)
| but the entire "buy now pay later" industry just reeks of preying
| on people that aren't as financially literate or have little
| impulse control, and I won't touch the companies with a ten foot
| pole.
|
| Honestly a bit disappointing to see this from Apple.
| Aaronstotle wrote:
| I initially purchased my new iphone 12 in monthly installments,
| yes I could have paid for it outright, but I didn't see the
| point in paying ~1k upfront.
| kimbernator wrote:
| If you're referring to a carrier's zero interest payments on
| the full price of the phone, that's just smart. No penalty
| for borrowing. If there was interest involved, it gets
| fuzzier.
|
| I'll amend this by saying that there's also another huge
| requirement for it to make sense: The new iphone must be
| necessary for any of this deal to make sense. If it was
| impulse bought because of this financing offer, then the
| financing has cost you >$1k
| yamtaddle wrote:
| Last I checked, my carrier (T-Mobile) charges like 10% more
| than Apple for the same device. They're just baking the
| interest into the price, it's not really "no interest".
| Maybe the others don't do that, though, I dunno.
| AdamJacobMuller wrote:
| Apple does it as well, for all(?) of their products now.
|
| no interest 12/24 month payment tied to apple card.
| mixmastamyk wrote:
| One often forgotten problem is the poor security of
| carriers. If they have all your financial details for
| credit purposes they will be leaked.
| gnicholas wrote:
| The interest rate on this is zero:
|
| > _Apple Pay users can split purchases into four payments with
| zero interest and no fees_
| kimbernator wrote:
| If you have impulse control and can properly conceptualize a
| loan, it could be a useful tool. In my experience, however,
| these kinds of programs don't target responsible spenders.
| People are pretty bad at thinking about monthly cost in terms
| of total cost.
| gnicholas wrote:
| Totally agree that it's best for responsible people. But
| what is Apple's goal here -- to increase the number of
| people/merchants using Apple Pay or hitting people with
| unexpected interest payments, which would sour them on the
| Apple brand? I would think that they're trying to grow
| their ecosystem, rather than make money while alienating
| customers. I could be wrong though -- when times are tough,
| even good companies do lousy things.
| kimbernator wrote:
| I don't really think Apple's interest is in collecting
| interest on these payments, but I do think it will cause
| people to use Apple Pay more because it enables (perhaps
| encourages) them to buy things they otherwise wouldn't
| buy. That can be good or bad depending on the
| circumstances, I just expect this will be frequently
| utilized in an "impulse buy" sort of way because it
| creates an illusion of affordability.
| raincole wrote:
| It sounds suspicious tho. So who takes the risk?
| BirAdam wrote:
| Essentially, Apple. Goldman is getting their pay in
| transaction fees. Apple is hoping to increase the number of
| purchases made on Apple's products. You get cash back on
| each transaction, Goldman gets a percentage of each
| transaction, Apple just loses a tiny bit of their profit on
| the sale, but they still made the sale. The only issue then
| is that debt collection is more expensive. The truth,
| however, is that most people pay their debts.
| simonswords82 wrote:
| Miss one of those interest free payments and I suspect it
| gets expensive very quickly.
| gnicholas wrote:
| You think Apple is lying about this? Or you think that they
| are hoping that you miss payments and then they (a three
| trillion dollar company) are going to make a material
| amount of money on an interest penalty?
| raincole wrote:
| > You think Apple is lying about this?
|
| No of course not. I'm not saying Apple is lying.
|
| > Or you think that they are hoping that you miss
| payments and then they (a three trillion dollar company)
| are going to make a material amount of money on an
| interest penalty?
|
| Maybe? I don't know how much banks make from this kind of
| thing. That "(a three trillion dollar company)" comment
| is so irrelevant that it's almost laughable tho. Banks
| are huge companies too, and they still make money from
| interest.
| gnicholas wrote:
| Yes, banks are large precisely because they make money
| this way. The point is that Apple makes huge amounts of
| money by selling tech products and services, and by
| having a loyal following. It would be surprising if they
| decided to trade some of that goodwill for a relatively
| (in their world) amount of cash.
| mateus1 wrote:
| I agree in spirit but buying things in installments is just a
| reality here in Brazil and in a lot of other countries.
|
| It's a loan like any other. When used correctly it can be a
| democratizing function for people who are poor but need
| important things like phones, fridges, and stoves.
| freetinker wrote:
| It says "Apple Pay users can split purchases into four payments
| with zero interest and no fees."
|
| Seems like a good deal - Apple is giving away money for free,
| especially given current interest rates.
| paxys wrote:
| The BNPL industry isn't some big charity. They offer such
| deals to hook people in, knowing that a huge chunk of them
| will miss payments and then they can hit them with interest
| and fees.
| danpalmer wrote:
| Actually that's not how they make their money, and arguably
| is a distraction from their real money maker.
|
| https://www.bitsaboutmoney.com/archive/buy-now-pay-later/
| lotsofpulp wrote:
| Great link. But I assume Apple BNPL is not collecting
| 300bps extra processing fees from any and all merchants
| that accept Apple Pay.
| CapmCrackaWaka wrote:
| Exactly. However, I think a bigger advantage of this
| business model is that it simply sells more stuff. It's way
| easier to look at your monthly take home income and justify
| $100 per month for 12 months than a 1 time purchase of
| $1200. However, the problem is when you make those
| justifications, it becomes easier to make 10 of those
| purchases and achieve a debt-income ratio of 5.0 instead of
| budgeting and keeping a lower debt-income ratio over time.
| chollida1 wrote:
| > It's way easier to look at your monthly take home
| income and justify $100 per month for 12 months than a 1
| time purchase of $1200.
|
| I think you should note that for apple, they are
| splitting payments into 4 over 6 weeks. So your example
| wouldn't fit the discussion we're having here.
| hot_gril wrote:
| The lesson I taught myself is to amortize everything so it's
| thought of as $/time. An upfront purchase has an opportunity
| cost.
|
| Also, most people can't pay for a house upfront. Mortgages are
| effectively govt-subsidized, so you usually want one anyway. I
| directly care what the house will cost me per month, and the
| bid price is only part of that.
| danpalmer wrote:
| I used to have this opinion, and I try to take as little debt
| as possible. However, I've change my opinion in recent years,
| and I now think it's based on a privileged position that not
| everyone is in.
|
| Buying a new phone today rather than once I've saved up is a
| luxury, but buying a replacement phone today rather than being
| without a phone for ~months while saving up could bring with it
| significant costs - making it harder to access employment,
| healthcare, or to socialise. Similar examples would be things
| like car repairs.
|
| Cash flow is worth something, businesses have known this
| forever, and people living paycheck to paycheck are typically
| experts in how to make their money work as well as possible
| because they're so close to the edge. I trust them that if they
| think this is the best option for them, it probably is. Payday
| loans are in the same category here (and businesses call them
| "commercial paper").
|
| Now, I'd love to live in a society where this isn't necessary,
| but that's not the world we live in, so I'm in favour of these
| things being available for those who need them.
| SoftTalker wrote:
| A more practical version of this rule is "don't use long term
| debt to pay for short-term expenses"
|
| When buying a car, or house, or maybe something like a phone
| that you will use continuously for a number of years, you can
| make an argument that it's OK to pay for that item over the
| same time period.
|
| Where people get into more trouble is buying consumable stuff
| like clothes, food, etc. on to a credit card that they don't
| pay off every month, and then they end up paying for a box of
| macaroni or package of underwear over many years (at
| typically double-digit interest rates).
| mixmastamyk wrote:
| Yes, goal should be to use debt to buy appreciating assets,
| not depreciating ones.
| oogetyboogety wrote:
| Payday loans are in the same category but in terms of
| predatory financial options i feel as though they are a
| million times worse. I even question how apps like Dave work
| on this type of model.
| agentdrtran wrote:
| If your laptop breaks and you need a new one you are probably
| better off doing BNPL if you can instead of buying a cheap,
| crappy one now.
| raincole wrote:
| Well it's actually boiled down to if you make money with your
| laptop. I guess most people on HN are programmers so of
| course they do. But the question is not good laptop vs crappy
| laptop, it's consumption vs investment.
| paxys wrote:
| Exactly. Taking a 15-30 year loan to buy a house makes sense.
| Using Affirm or Klarna or Apple Pay Later to buy groceries or a
| new laptop does not.
| [deleted]
| thesuperbigfrog wrote:
| >> Honestly a bit disappointing to see this from Apple.
|
| They can't raise prices on the latest iGoodies if no one can
| afford to buy them.
|
| Buy Now Pay Later can ensure users "can afford" the latest
| iGoodies instead of having to wait for the price drops on not-
| the-newest iGoodies.
|
| They are being innovative and _enabling_ their own business to
| succeed despite the current economic conditions.
| aeontech wrote:
| This is probably sarcasm, but, financing for iGoodies has
| been available for years. That's not what this feature is :)
| bootloop wrote:
| If you think you need this you certainly shouldn't use it.
| soupfordummies wrote:
| Need... STUFF!
| lavezzi wrote:
| This is honestly disgusting predatory behaviour which seems to
| be rampant in Fintech right now. The majority of people they
| are targeting for this service shouldn't be put in the position
| to have this available to them.
| koromak wrote:
| BNPL schemes are (or at least were as of a year ago) destroying
| Gen Z. This one may be less destructive as it doesn't look like
| interest rates are a thing, but still. Don't get into the habit
| of spend ing money you don't have.
| erulabs wrote:
| Speculation, but the lack of interest rates is probably
| _more_ destructive. The profit here comes from more usage on
| Apples cc system rather than some other bank taking the rake.
| Apple is incentivized to make "spending money you don't have"
| as easy as possible - it directly benefits from it - and thus
| makes it even more appealing with no interest rates.
| wackget wrote:
| This is just what the world needs during a cost of living crisis.
| elif wrote:
| Nothing says "consumers financial interests" like selling them
| expensive electronics and clothing they can't afford..
| kitsunesoba wrote:
| I haven't traditionally made use of services like this, but am I
| correct in that one might be able to make small gains with them,
| much as is possible with credit cards?
|
| For example if there's a large purchase one needed to make and
| had the cash on hand for, wouldn't it be smarter to let most of
| that cash accrue some interest in one of the many 4%+ interest
| savings accounts now available while making payments on the 0%
| interest BNPL?
| ericpauley wrote:
| In theory yes, but this is way less beneficial than just using
| a credit card.
|
| The average maturity date on Apple (and others) BNPL is 3
| weeks. Credit cards have a _minimum_ payment deadline of 3
| weeks from the statement without accruing interest, and on
| average you 'll get another 2 weeks on top of that depending on
| when in the cycle you made the purchase. So you're getting at
| least the same average time to accrue interest, plus you're
| getting credit card rewards of 1-5%.
| lotsofpulp wrote:
| No, you are better off with a simple credit card that gives 2%
| cash back.
|
| This is for people who cannot get approved for a credit card.
| pram wrote:
| I've used the existing payment thing to buy a MacBook Pro on my
| Apple Card back in 2021. I mean at 0% interest seems like it's
| all in your favor if you're not spending like a dumbass.
| bobleeswagger wrote:
| Kind of surprised it took Apple this long to jump on the defer
| everything train.
| kernal wrote:
| And just like that all of the other pay later services just took
| a massive haircut.
| kart23 wrote:
| This is gonna make a major dent, if not kill Affirm and all the
| other companies in the BNPL space. Having it integrated is just
| so convenient.
| exizt88 wrote:
| Yeah, the commenters here are missing a HUGE disruption in the
| BNPL market. Klarna was already ailing -- I wonder if they can
| survive this punch. Interesting to see how BNPL industry will
| respond.
| thot_experiment wrote:
| I'm not sure about that, grain of salt because I did no
| research to back this up but aren't apple users in general
| wealthier and therefore less likely to be the market for this
| sort of thing?
| keiferski wrote:
| Supposedly 87% of American teenagers have an iPhone, so Apple
| does seem to have a wide range of customers.
|
| https://www.howtogeek.com/778355/new-study-says-87-of-us-
| tee...
| cal85 wrote:
| I am surprised to see Apple getting into the "buy now, pay later"
| game, as it's always seemed like a murky industry that works by
| exploiting poor people who aren't very good with money, and not
| something I'd expect Apple to want to be associated with. Can
| anyone steelman it for me? Is there a way of looking at this
| industry/practice other than "exploitative and predatory"?
| tantalor wrote:
| From the press release:
|
| > [users want] flexible payment options
|
| Being able to spread some large purchase over multiple pay
| periods seems like a obvious use case.
| kzrdude wrote:
| Credit cards are commonplace, aren't they? They offer buy now,
| pay later any consumer product already.
|
| But sure, it's exploitative, they want a piece of that already
| existing cake.
| jonfw wrote:
| When businesses buy now and pay later, it's smart business.
| When consumers do it, they're being taken advantage of?
| n8cpdx wrote:
| I feel like Apple has lost their way with the focus on services.
|
| If they are going to focus on services, they should make them
| best in class. I expect best in class software, but Apple Music
| still doesn't have anything like Spotify Connect and it is still
| incredibly slow and unreliable software (for what it is).
|
| I don't understand how tarnishing the premium brand with BNPL is
| worth it long term. And I especially don't understand how all of
| their 0% interest offers will make sense in a world of 5+%
| interest rates.
| pathartl wrote:
| They've been taking the shotgun approach for a while. Their
| product isn't any individual component, it's the platform as a
| whole. Why people want a company that sells: - Phones
|
| - Computers
|
| - Tablets
|
| - Headphones
|
| - AR headsets
|
| - Cars
|
| - Watches
|
| - Streaming boxes
|
| - Speakers
|
| - Email
|
| - Video streaming subscriptions
|
| - News aggregation
|
| - Fitness routine subscriptions
|
| - Music streaming subscriptions
|
| - Video game subscriptions
|
| - eBooks
|
| - Apps
|
| - Cloud storage
|
| - Credit cards
|
| - BPNL
|
| is completely beyond me. Yes there's stuff in there they
| haven't announced. Yes there are a lot of accessories and
| services not listed.
|
| I'm probably a Microsoft shill at this point, but I am a .NET
| dev running Windows and I have a Microsoft 365 family
| subscription and bought an Xbox. All of my hardware is from
| other manufacturers. My finances are not tied to MS. I can't
| think of another company that has gotten the amount of blind
| trust that Apple has.
| [deleted]
| cal85 wrote:
| Is Spotify Connect distinct from Spotify?
| ketaminisiert wrote:
| I don't understand what an advantage there is if you finance a
| purchase but have to pay off the installments every 2 weeks. I
| doubt that there are so many people getting paid bi-monthly.
| pastor_bob wrote:
| Apple card already allows you to pay in monthly installments with
| no interest and gives you back 3%: https://www.apple.com/apple-
| card/monthly-installments/
| hot_gril wrote:
| For people who qualify
| kevincox wrote:
| > with no impact to their credit[4]
|
| > 4. Upon purchase, a user's Apple Pay Later loan and payment
| history may be reported to credit bureaus and impact their
| credit.
|
| What? Doesn't that footnote directly contradict the text that
| references it?
| hammock wrote:
| "Users can apply for a loan within Wallet with no impact to
| their credit."
|
| Typically what people worry about are the cost of a hard pull
| when applying for credit. Apple is saying they will not do a
| hard pull
| lotsofpulp wrote:
| People should worry about having small short term loans on
| their credit report, because it could result in other lenders
| assessing them as a higher risk and therefore a higher
| interest rate.
|
| For example, you use Apple BNPL, and then in a couple years
| you go to buy a house, and they see that you use a BNPL
| service, and so their underwriting classes you as a higher
| risk and you could end up paying 100bps more on a mortgage.
|
| But the wording on Apple's website is fine since the whole
| claim is technically true:
|
| >Users can apply for a loan within Wallet with no impact to
| their credit.
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