Goldman’s Apple Card Partner Faces Uncertain Future

A deal between Apple and JPMorgan could reportedly leave a lesser-known company in the cold.

As the Wall Street Journal (WSJ) reported Sunday (Aug. 3), CoreCard has helped provide Apple’s credit card with distinctive features, including bills on the first of the month and a payment wheel that shows users projected interest costs.

Apple is CoreCard’s biggest client, but that relationship could soon be at an end, the WSJ said, as Apple winds down its own credit card partnership with Goldman Sachs.

Last week saw reports that Apple was close to reaching an agreement with JPMorgan Chase in which the bank would become the tech behemoth’s credit card partner. A report by the WSJ said the companies had been in talks since early last year.

A separate report by CNBC said the companies were close to a deal on the Apple Card portfolio, adding that JPMorgan wanted concessions on how the card is serviced before agreeing to take over the portfolio.

Apple entered the credit card space with the launch of the Apple Card in March 2019. CEO Tim Cook said at the time that “while we all need them, there are things about the credit card experience that could be so much better.”

But by November of 2023, the company was looking to end its card partnership with Goldman Sachs and had proposed an exit from its contract.

The program was initially designed to last through 2029, but Goldman Sachs told Apple that it intended to offload the partnership after dealing with significant losses as it attempted to develop a full-service consumer operation.

According to the WSJ, CoreCard Leland Strange has said his company could lose the Apple credit card if JPMorgan were to take over. The report describes CoreCard’s partnership with Goldman seven years ago as a “major coup.”

Days after the card was launched, CoreCard’s valuation peaked at $490 million. No other major bank, the report added, uses CoreCard, with the payment-processing industry dominated by a handful of giants.

Because JPMorgan has in-house processing capabilities, Strange told the WSJ he thinks it is unlikely that the Apple card will remain with CoreCard in the long run if the bank takes over as the issuer. The same risk would be in place if a different issuer landed the Apple deal.

“CoreCard is in a very unique and odd situation,” Strange said.