The striking annual return of 4.15% plus the ubiquity of the iPhone is what is generating a boom in the savings account created by a renowned technology company.
The striking annual yield of 4.15% plus the ubiquity of the iPhone is what is generating a boom in the savings account created by Apple next to Goldman Sachs. At the end of the launch week, 240,000 accounts were opened, according to official data.
Goldman’s own high-yield savings account housed under its consumer brand, Marcus, offers a 3.90% yield, notably less than Apple’s product.
“Banks have responded quickly to the Federal Reserve’s interest rate hikes with higher rates on home loans and auto loans, but customers have seen little to no increase in traditional bank deposits or savings accounts.says Richard Crone, CEO and founder of payments firm Crone Consulting. “There is a way out to CDs, money market funds and fintechs like Apple.”
Apple’s savings account is entering a fierce competition among financial institutions to attract and hold deposits after a cascade of bank failures.
Manzana
REUTERS
How to access the new account?
The new savings account is only available to holders of the Apple Credit Card, Apple Card. Customers can open a savings account in less than a minute right from their iPhone. Apple Card spending rewards, called Daily Cash, are automatically directed to the high-yield account.
Customers can track their balance and earned interest from a dashboard integrated with Apple’s digital wallet. Prior to Apple Savings, daily cash rewards were automatically deposited into Apple Cash, a digital prepaid card stored in the iPhone’s digital wallet and issued by Green Dot Bank. Crone Consulting estimates that $3.8 billion in Apple Cash is deposited annually from the Apple Card, funds that will now find their way into the savings account. Apple High Yield Savings accounts cannot exceed the FDIC insurance limit of $250,000.
Many traditional regional banks are struggling to maintain net interest margins following the Fed’s massive rate hikes, and as a result, few have matched Apple’s 4.15% rate on FDIC-insured savings accounts. .
Source: Ambito
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