- Apple launches high-yield savings account for holders of its Apple Card credit card
- The annual interest rate is 4.15%, more than 10 times the national average in the United States
- The savings account adapts to the particular context of savings in the United States, which is lower, less regulated and more volatile than in France
Juicy. This is how we could qualify the new savings offer announced by Apple on April 17, 2023 by press release.
Offered in partnership with Goldman Sachs, the Apple Card-issuing bank, Apple Savings offers an annual interest rate (APY) of 4.15%.
This savings account is accessible free of charge, with no minimum deposit or minimum balance requirement. Just have an Apple Card and go to the app Wallet to configure it. Once the account is opened, all Daily Cash earnings received from the Apple Card will be automatically deposited into the savings account and will start earning interest.
The Daily Cash is the Apple Card rewards program which allows users to receive a percentage of the amount of their purchases in cash. The rate varies depending on the type of purchase: 3% for purchases made at Apple or certain partners (such as Uber or Nike), 2% for purchases made with Apple Pay and 1% for purchases made with the physical card.
With this new savings account, users can therefore grow their rewards effortlessly and without risk. They can also transfer funds to or from their regular bank account or use their savings to pay off their Apple Card balance, since it’s also a credit card.
Users can also manage their savings account directly from the application Wallet : they can consult their balance, their transaction history and their accumulated interest in real time.
On the security side, Apple says savings account is protected by the same technologies as the Apple Card, such as Face ID, Touch ID and data encryption. Apple Savings is also insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 per depositor.
Apple Savings: juicy savings for Americans
The Apple Savings Account is currently not only available in the United States, where the Apple Card was launched in August 2019. Apple has yet to announce whether it plans to bring its credit card and savings account offering to other countries. And for good reason, the American savings model is very special.
In the land of Uncle Sam, interest rates are indeed much lower than in France, for example. According to the website Bankratethe average rate for savings accounts in the United States was indeed 0.36% in March 2023. With 4.15% interest, Apple Savings is therefore “more than 10 times higher than the national average in the United States” Apple proudly advances.
The savings of American households are also more volatile, less regulated and less diversified than those of French households. In France, there are many savings products that are tax-exempt and guaranteed by the State, such as the livret A, the sustainable and solidarity development booklet (LDDS) or the housing savings plan (PEL). These products offer low but stable interest rates.
In the United States, there is no equivalent to these products. Savings accounts are offered by commercial banks and are subject to market competition. Interest rates are therefore higher but also more fluctuating. They depend in particular on the key rate of the American Federal Reserve (Fed), which influences the cost of credit.
More cautious (but also bigger consumers) Americans therefore save less than the French. Selon Statesman, the personal savings rate (share of disposable income that is not consumed) in the United States was 4.6% in February 2023, compared to 15.7% in France according to INSEE. After a sharp rise in April 2020, in the midst of the health and economic crisis (33.7% in the United States and 27.4% in France), it then fell gradually with the resumption of activity, the lifting of restrictions and the inflationary crisis.
Apple bites the Big Apple
With this new savings offer, Apple strengthens its strategy in the world of finance and is positioned as a key player in mobile payment.
The Apple Card, launched in 2019 in partnership with Goldman Sachs, is a credit card that stands out for its integration into the Apple ecosystem, its ease of use and its attractive rewards program.
Selon Forbes, Apple would aim to control the entire payment chain, reduce network costs and improve the customer experience. The Apple Card would also be a lever to increase iPhone sales, especially in markets where consumer credit is underdeveloped. Apple could thus increase the loyalty of its customers and encourage them to use its financial services.
Why Apple Savings will probably never arrive in France?
Still, this offer is difficult to export to other areas of the world, the American consumption and savings model being a very special case. With a rate of 4.15%, a savings offer like Apple Savings would certainly be interesting in France, but difficult to apply.
First, because the Apple Savings account is linked to the ownership of the Apple Card, a credit card that does not exist in France.
Moreover, in France, bank cards are generally associated with a current account and allow payment in cash or on credit.
Revolving credit (the one offered with an Apple Card) is a form of consumer credit that provides a reserve of money that can be used at any time. It is often offered by stores or specialized organizations.
More revolving credit is subject to strict rules in France, in particular with regard to interest rates, terms and consumer information. Which probably explains why four years after its launch, the Apple Card is still not available in our country.
