What the Apple Card High-Yield Savings Account is Really About

Don't think of the new Apple Savings account as a standalone competitive banking product. Analysts say it's one more brick for building a 'walled garden' of financial and other services for iPhone users that will drive the growth of Apple Pay, Apple Card, and more of the big tech's offerings.

By Steve Cocheo, Executive Editor at The Financial Brand

Many in banking may view the news of Apple’s latest consumer financial product — a high-yield savings account — as unlikely to be a game-changer. High-yield digital savings offers abound and tend to come out of the woodwork in rising-rate environments.

Yet Apple being Apple, things are never that simple, or obvious. The Financial Brand dug behind the headlines to tease out key aspects of the rollout. Taken together, they present a compelling case that once again, Big Tech is taking incremental steps to dominate what it views as a financial ecosystem.

The latest case in point is Apple’s October 2022 announcement that it was going to augment its Daily Cash rewards system for the Apple Card by setting up a high-yield Savings account that cardholders could place Daily Cash into. The account would be offered through Goldman Sachs, Apple’s card partner. Beyond that, cardholders will be able to deposit additional money into Savings from a linked bank account or from their Apple Cash card, a virtual card offered through Apple’s partner, Green Dot Bank. All of this will go through the Apple Wallet, which is also home to Apple Pay.

It’s a payments play, a banking play, and something else entirely.

Considering Flywheels, Ecosystems, and ‘Apple Bank’

“Apple’s motivation is not to become a bank, but to drive an ecosystem,” says Ron Shevlin, Chief Research Officer at Cornerstone Advisors. He applauds the timing of introducing “high-yield” savings at a point when rates have started to actually rise towards meaningful levels for savers, but, again, this is not traditional competition.

The word — “ecosystem” — comes up a lot in discussions about Apple’s financial activities -

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