Apple Card welcomes ‘subprime’ applicants, as Jobs would have wanted

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Apple Card
Just spend it.
Photo: Apple

A less-than-stellar credit score may not stop you from bagging a shiny new Apple Card.

“Subprime” applicants are being accepted for credit, issued by Goldman Sachs, because Apple wants as many of its iPhone users as possible to be approved.

And it’s what Steve Jobs would have wanted.

Apple Card isn’t officially open to everyone yet, but a lucky few have been invited to claim theirs early. And some, who expected to be turned away due to a low credit score, were surprised to get a big thumbs-up from Goldman Sachs.

“The bank, which is in charge of deciding who gets the Apple Card, is accepting some applications from users with less-than-stellar credit scores,” reports CNBC, citing people familiar with the matter.

Here’s why.

Apple Card is for everyone

Apple worked with Goldman Sachs to deliver a credit card for almost everyone. There are now more than 100 million iPhone users in the U.S. alone, and Apple wants as many as possible to have access to its product.

That doesn’t mean every application will be accepted. Apple and Goldman Sachs still have to work within the bounds of regulations and responsible lending. But the bank may be more lenient toward Apple Card applicants than it would be for other services.

“I was absolutely shocked I got it,” Apple Card customer Ed Oswald told CNBC. “I have a lot of collections from two or three years ago when I was in a really roughly spot … I figured they were going for the high-income set.”

But Oswald was approved with a credit limit of $750 and an interest rate of 23.99%, which he says is lower than his other credit cards.

This makes perfect sense for a number of reasons.

It’s what Steve Jobs would have wanted

Apple Card is yet another service that ties users to Apple devices. If you have one and you use it often, you’re less likely to switch to a competing platform like Android, where you will no longer have access to your spending data.

For Apple, then, the reward of making Apple Card widely available outweighs the risk of lending to potentially poor debtors. And it’s exactly what Apple co-founder and former CEO Steve Jobs would have wanted.

Jobs explored the idea of launching an Apple Card several times. When he held discussions with Capital One in the late ’90s, Jobs “had an aversion” to rejecting any of Apple’s customers for credit, one source said. He didn’t want anyone to be left out in the cold.

It seems Apple has the same feeling toward Apple Card today.

Apple encourages responsible use

There is a chance this approach, which could make it easier for those who are already struggling with debt to rack up even more, will lead to backlash against Apple. But Cupertino and Goldman Sachs are taking steps to encourage responsible lending.

The bank will only provide as much credit as a person’s profile suggests they can afford. So, if you have a low credit rating, you’ll get a lower credit limit. Apple also makes it incredibly easy to track spending on iPhone, and encourages higher-than-minimum repayments to reduce the amount of interest borrowers pay back.

Don’t assume you can’t get an Apple Card if you’re credit rating isn’t considered excellent, then. You might be surprised to find that Apple welcomes you with open arms.