Apple in Discussions with JPMorgan to Take Over Credit Card Program from Goldman Sachs

Apple is in early negotiations with JPMorgan Chase to take over its flagship credit card program, the Apple Card, from Goldman Sachs, according to a source familiar with the discussions. The talks are still in the initial stages, and several critical aspects, such as the price and whether JPMorgan will retain certain Apple Card features, are yet to be finalized. The source, who requested anonymity, noted that the deal could fall through over these or other issues in the coming months.

The potential transition comes after Goldman Sachs decided to shift away from its retail banking strategy, which included its partnership with Apple. Goldman had faced losses and regulatory scrutiny over the Apple Card, prompting the tech giant to seek a new issuer. Few U.S. banks have the scale and willingness to take on the program, with JPMorgan—currently the largest credit card issuer by purchase volume—emerging as a possible candidate.

JPMorgan is reportedly looking to pay less than the face value of the $17 billion in Apple Card loans due to concerns over elevated losses. Sources close to Goldman Sachs attributed the higher-than-average delinquencies to the fact that many of the cardholders were new accounts, with expectations that losses would decrease over time. However, questions about the portfolio’s credit quality have made it less attractive, especially amid fears of a potential economic slowdown in the U.S.

Additionally, JPMorgan may opt to eliminate the Apple Card’s calendar-based billing feature, which sends all customers their statements at the start of the month. While convenient for users, this practice creates a surge in customer service calls during that period, a burden JPMorgan would likely prefer to avoid.

Both Apple and JPMorgan declined to comment on the negotiations, which were first reported by The Wall Street Journal.