Apple has officially launched Apple Card’s savings account with a 4.15% annual percentage yield (APY).
- Customers who own an Apple credit card can now sign up for a savings account through the Apple Wallet app.
- The company offers a competitive APY of 4.15%, while the national average annual percentage yield for savings accounts is around 0.4%.
- Online, only UFB Direct, Vio Bank, and CIT Bank are currently offering 5.02%, 4.77%, and 4.75% APY respectively, according to Bankrate.
- The accounts are managed by Goldman Sachs, meaning the Federal Deposit Insurance Corporation (FDIC) covers balances.
Why it’s news
Apple is attempting to entice more customers to join its groaning financial services sector by announcing a new offering—a high-yield savings account.
The company recently announced that it now offers a savings account with an APY of 4.15% for all Apple credit card users. Apple has partnered with Goldman Sachs to offer the account to customers, which does not have a fee and does not require minimum deposits and balances.
When users pay with their Apple Card, which can be a physical card or digital, they get cash back on all purchases. The cashback is contained in an Apple Cash section in the Wallet app, which works similarly to a checking account. Now users can deposit their cash earned from purchases directly into their savings account and collect interest on the money.
“Savings helps our users get even more value out of their favorite Apple Card benefit—Daily Cash—while providing them with an easy way to save money every day,” says Apple VP of Apple Pay and Wallet Jennifer Bailey.
“Our goal is to build tools that help users lead healthier financial lives, and building Savings into Apple Card in Wallet enables them to spend, send, and save Daily Cash directly and seamlessly—all from one place.”
There are no fees associated with Apple’s savings account. However, there is a maximum balance limit of $250,000. The APY of 4.15% applies to any sized balance, and no minimum balance is required, according to TechCrunch.
The new service comes as many experts begin encouraging people to utilize a digital wallet to electronically store their cards, licenses, and other forms of identification.
Nearly 90% of consumers are now using some form of digital payment in daily life, and 62% use more than one kind, according to a 2022 report from McKinsey & Company.
A virtual wallet is fast and convenient, allowing consumers to have everything they need in one place and still have access to their accounts if a card is lost or takes multiple weeks to be shipped.
Many consumers argue that a digital wallet is safer than physical cards because current smartphones are heavily encrypted, making it harder for someone to access the information and steal funds.
Others disagree, stating that having all your information in one place is highly dangerous. If someone steals a phone, they can access the digital wallet and have all of the information readily available in the same place.
Another digital downside is that not all stores accept digital payment options, so having a physical payment option is still necessary. Many stores are beginning to accept digital wallets, but not all have adapted to the trend.