Analyst: Apple Card may take years to become a material business; Apple Debit Card coming

Patrick Seitz for Investor’s Business Daily:

Apple has begun offering its new credit card to consumers, but the Apple Card has a long way to go to be a material business driver for the company, a Wall Street firm said Wednesday.

In a report, Nomura Instinet said early reviews for the card are positive, but it will take years for the business to scale. The brokerage reiterated its neutral rating on Apple stock. “Initial reviews indicate the card offers smooth integration with Apple’s other apps, intuitive expense tracking, heightened privacy, and of course, titanium-level branding,” Instinet analysts Bill Carcache and Jeffrey Kvaal said. The report added, “The card may require years to reach our threshold for materiality, or above $1 billion in operating profit. Instead, we consider the card best viewed in a less linear fashion as another building block in Apple’s growing financial suite, alongside Pay, Wallet, Cash, and potentially, over time, Debit.”

Instinet believes Apple will next offer a debit card. “Since most customers are likely to pay the outstanding balance on their Apple Cards via their bank accounts, Goldman Sachs will obtain customer bank account information, which it could use to offer Apple Debit,” the brokerage said.

MacDailyNews Take: Apple Card will be more popular than most people think and it will spur the use of Apple Pay significantly.


    1. If you could use a browser, you (and a thief) could sidestep all the security features that are the whole point of the exercise. This is not just an Apple-branded conventional card; it is something new.

  1. Sorry, I still think tech companies dipping their toes into personal finance is a very, very bad idea. For once, I hope an Apple product flops. And you are right, MDN: the tens of you that fiddle with Apple Pay in a busy line look like tech dorks on a mission to prove that you are, beyond the shadow of a doubt, tech dorks (to be fair, I haven’t seen a single instance of Google Pay et. al. IRL, ever. I have seen one or two iPhone transactions). Apple Pay offers zero advantage over whipping out a card, or even better, cash. Cash is the easiest payment method of all, and the most secure. The majority of people could give two poops about ‘incentives’. Sorry, but it’s true.

    1. Sorry I am not sure of what you are trying to say here, cash is the most secure? surely not it can be stolen and used and you cannot ever claim it back, there is no security to it at all. Carrying a wallet with cards and taking them out of whichever pocket you have every time is in invitation to thieves to rob you, try living in a major city and taking out your wallet every time you want to make a purchase, in my opinion, apple pay on my watch has been by far the most secure thing, I have just come back from holiday with my family and I put my watch on in the morning, left my wallet safely behind and purchased everything using contactless pay machines and my watch, what could be more secure than that?

  2. Sorry, but it’s not true. I use Apple Pay whenever the opportunity presents itself, and it is MUCH more convenient and quick than fishing out a credit card, sticking it in a slot and waiting for a transaction approval. Only a person that’s used it would know this, so I conclude you’ve never used it. And OBTW, its much more secure.

  3. Why is there always some catch to whatever Apple attempts to do? There are always some major doubts on Wall Street when it comes to Apple. Hey, it’s just a credit card and there are hundreds of different types available. Why make the AppleCard into some high-risk move for Apple. Isn’t it rather soon for analysts and critics to be drawing conclusions? How about waiting at least six months or so for the holiday season results?

  4. I an super uncomfortable with criminal, cheater, and thief Goldman Sachs that helped to produce rhe great recession and got away with it and was rewarded with billions of $s of free money like a Socialist having the close tie-in with Apple.

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