The media reports that JPMorgan Chase which is currently the largest financial institution in the banking sector of the United States is in talks with Apple to become the technology giant’s new credit card issuer.
Journalists claim that progress has been recorded in the mentioned negotiation process in recent weeks. The media published the relevant information, referring to anonymous insiders who are aware of the details of the appropriate process, which is carried out in the so-called backstage format and is hidden from the public.
It is worth noting that so far there is no guarantee that the largest financial institution in the United States and one of the main players in the global technology sector will reach an agreement in the framework of discussing aspects of interaction and eventually form a system of cooperation. The negotiation process is ongoing, and its result is unknown. Within the framework of such processes, at certain stages, there may be signs of an early conclusion of an agreement, but over time there may be a significant deterioration in the situation in the context of mutual understanding, which will nullify all prospects for cooperation, even minimal and belonging to the category of strictly theoretical probabilities.
The media, which published information about the negotiations last Tuesday, September 17, also noted that there is no guarantee of a positive result.
JPMorgan did not respond to a request from reporters for comment on the mentioned insider information. The technology giant has also so far refrained from making any statements on the relevant issue.
Currently, the issuer of the Apple credit card is Goldman Sachs. Last year, this financial institution and the technology giant agreed to end their partnership. At the same time, as noted by the media, Apple and Goldman Sachs have not yet reached an agreement to take over the program with a new issuer, which, according to insider information, may become the largest bank in the United States.
In this case, it is noteworthy that the technology giant already has experience interacting with JPMorgan. As part of the relevant practice, the bank’s customers are offered deals on Apple products. Also, a financial institution pays the technology giant every time its clients use Apple Pay on their cards.
According to insider information, as part of the negotiation process, the bank seeks to reach an agreement to pay less than the full face value of outstanding balances under the program Apple credit card. Also, according to anonymous interlocutors of journalists, the financial institution aims to change some aspects of the mentioned program. In this case, among other things, it implies the requirement of the technology giant that cardholders receive their statement at the beginning of the month.
The media notes that Apple has subprime exposure and terms. The relevant circumstances may mean significant costs for any issuer.
In November, the media reported that Apple had offered to terminate its credit card contract with Goldman Sachs. At that time, the intention of the parties of the cooperation to implement the relevant initiative over the next 12-15 months was also constant. It is worth noting that the program was initially extended through 2029.
Goldman Sachs began the history of its presence in the credit card market in 2019. Four years later, the financial institution began to pull back the mentioned activity. The reason for this decision of the lender was that it faced significant losses, which became a kind of negative result of an attempt to realize the intention to launch a customer service practice with a full range of banking products. By early 2023, the financial institution announced that Apple plans to abandon the continuation of partnerships.
It is also worth noting that back in December, the media reported that JPMorgan could become a natural successor to take over the technology giant’s credit program. This assumption is based on the fact of the existing experience of interaction between a financial institution and Apple.
JPMorgan is one of the first Apple Pay partners. The financial institution also stores a portion of the technology giant’s cash of about $60 billion. Moreover, the bank is one of the largest credit card partners for transactions at Apple retail outlets.
As we have reported earlier, JPMorgan Seeks to Expand in Africa and Scandinavia.
