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Apple’s High-Yield Savings Account Surpasses $10B In Deposits

Apple Card's collaboration with Goldman Sachs proves successful as users flock to high-interest savings account.
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MACAU, CHINA – JULY 26, 2023 – Customers shop at the Londoner Apple Store in Macau, China, July 27, 2023. (CFOTO/Future Publishing via Getty Images)

Apple, Inc.‘s (NASDAQ:AAPL) foray into financial services has apparently proved fruitful, adding to the momentum the overall Services business is seeing.

Apple disclosed Wednesday, the high-yielding savings account it is offering to Apple Card customers has received over $10 billion in deposits. The service offered in collaboration with Goldman Sachs Group, Inc. (NYSE:GS) was launched in April.

Just after the launch, reports suggested the account drew in over $1 billion in deposits within four days.

The savings account promises a yield of 4.15% even when financial services giants pay literally no interest for the deposits their clients park with them. It also provides Apple Card users an opportunity to grow their daily cash rewards.

“With each of the financial products we’ve introduced, we’ve sought to reinvent the category with our users’ financial health in mind…it remained our guiding principle with the launch of Savings,” said Jennifer Bailey, Apple’s vice president of Apple Pay and Apple Wallet.

Apple said since the launch of the savings account, 97% of savings customers have chosen to have their daily cash automatically deposited into their account. Savings account hZenger News can also deposit additional funds into the account through a linked bank account from their Apple cash balance, it added.

The announcement comes even as reports suggested in July that Goldman is in talks to offload the Apple Card and savings account portfolio as the latter strives to scale down its consumer lending business.

Goldman also collaborates with Apple for its ‘Buy Now, Pay Later’ service the tech giant launched in March.

A Wall Street Journal report said in early June that Apple savings account hZenger News are scrambling to close down their accounts due to difficulty in the withdrawal of funds.

Apple’s financial services business is part of its Services business. Wedbush analyst Daniel Ives said in a note released on Wednesday that he sees a reacceleration of the Services business to a double-digit growth pace, thanks to expanding iPhone user base, improving attach rates on Services, and price increases.

“We believe overall the Services business is worth $1.3 trillion to $1.4 trillion for Apple’s sum of the parts valuation and remains an underappreciated asset by the Street,” he said.

Apple is scheduled to report its fiscal year third quarter results Thursday after the market close, with analysts modeling in-line to higher results and upbeat September quarter guidance.

Apple closed Wednesday’s session down 1.55% at $192.58, according to Zenger News Pro data.


Produced in association with Benzinga

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