Altogether, users have deposited nearly $1 billion in the Goldman-backed Apple Savings account, which is said to have been launched just four days after it launched. two sources Get familiar with the subject.
On launch day, savings accounts received close to $400 million in the deposit. With banks currently offering annual interest rates of less than half a percentage point, the biggest drivers of the surge in account openings can be attributed to their 4.25% annual interest rates and the near ubiquity of the iPhone.
Insufficient bank savings account
As the Fed prepares to raise rates again, banks are taking a more conservative approach:
Richard Crone, CEO and founder of payments firm Crone Consulting, told Forbes:
“Banks responded quickly to the Fed’s rate hikes with higher mortgage and auto loan rates, but savers saw little increase in traditional bank deposits or savings accounts. Money went to CDs, money market funds and fintech companies like Apple.”
Bank failures are likely to continue as consumer confidence in banks begins to wane and deposits are exodus, as happened most recently at First Republic Bank and Silicon Valley Bank in March.First Republic Bank Fails Second Largest Bank in U.S. History, Fed Admits They Failed to Deliver Supervision.
what makes apple different
We recently reported on how Apple is leveraging savings amid fierce competition among financial institutions. But Apple brings more benefits than traditional financial institutions in the market. For example, Apple Card has no annual fee or late fee, but users must have an iPhone with iOS 12.4 or later. They must also have an Apple ID, and an iCloud account in good standing. Additionally, the Annual Percentage Rate (APR) that users purchase depends on their credit history, ranging from 16% to 27%.
Apple Savings is only available to holders of Apple Card, the Apple credit card. In less than a minute, users can open their savings accounts directly from their iPhones. All Apple Card spending rewards, also known as Daily Cash, are deposited into a high-yield account.