Apple Pay — promises instant approval, up to 3 percent cash back, no late penalties and virtually no additional fees to use. Issued by Goldman Sachs and Master Card, Apple’s almost seems to be too good to be true. Maybe it is.— Apple’s new mostly-digital credit card that’s an extension of
We dove into the fine print to see what kind of details we could uncover about Apple’s major disruptor payment card.
You still have to qualify
During its presentation on Monday, Apple made it seem like anyone could open the Wallet app, apply for the Apple Card and begin using it a few minutes later. That may be the case for many, but you still have to qualify to be approved for an Apple Card. Apple hasn’t shared the details, but made it clear that you will need to qualify:
US customers can now sign up for the latest news about Apple Card on apple.com/apple-card. Apple Card will be available to qualified customers in the US this summer.
You can still earn Daily Cash rewards without an Apple Cash account
Daily Cash is what Apple calls a 1 to 3 percent cash back reward you get every time you use Apple Card online or in stores. So what’s Apple Cash and why is that relevant? Good question. It appears to be related to the Apple Pay Cash card, which is a peer-to-peer cash exchange system like Venmo or PayPal that lets you send money to other people using iOS. Expect these two names to merge in the future.
Apple says that an Apple Cash card is required for receiving Daily Cash, but if you don’t have an Apple Cash account:
Daily Cash can be applied by you as a credit on your statement balance. Daily Cash is subject to exclusions, and additional details apply. See the Apple Card Customer Agreement for more information.
There’s a limit to unlimited Daily Cash rewards
Apple crowed about unlimited Daily Cash rewards, which means that there’s no arbitrary cap on how much cash back you can earn. So, for example, if you were to spend $6,000 buying iPhones ($1,000 at Amazon) for the family, you could earn $180. If you spend more than that, you can earn more, too.
That’s all theoretical. In reality, you can top out if you try to exceed your credit limit. So if your limit is $3,000, you’ll only be able to earn $90 in Daily Cash until the next billing cycle. If you max out at $10,000, you’ll be able to earn up to $300.
The credit limit is a standard part of being issued a credit card. Typically the better your credit and longer your duration using a credit card, the more credit your bank will extend you over time.
Keep an eye on interest estimates
One Apple Card feature that Apple celebrated is the ability to track how much you own using the app. If you don’t pay off your balance at the end of the month, you can tell the app how much you’re paying. Apple’s software will then estimate the interest cost for you, so you can see how much more you’ll have to go to clear your balance.
The fine print here isn’t a “gotcha,” it’s just a reminder that the estimate is based on your balance at the time you’re using the app. Pending transactions and other purchases you make before the end of the billing cycle don’t enter into the interest estimate.
Late payments will cost you
Let’s talk about fees. Apple Card won’t slap you with fees if you’re late to a payment, and there are no annual fees, international fees or fees for going over your limit.
Yes, there’s a catch. While Apple won’t charge you a penalty for missing a payment — e.g. no $25 late fee in addition to what you already own — you’ll still get charged interest. According to Apple’s website:
Late or missed payments will result in additional interest accumulating toward your balance.
In other words, Apple isn’t giving you money for nothing.
Interest rates still apply (of course)
Speaking of interest, Apple didn’t discuss interest rates specifically when it showcased the Apple Card, but looking into the footnotes of its website, they become clear:
Variable APRs range from 13.24% to 24.24% based on creditworthiness. Rates as of March 2019.
Software might change, but no big surprise there
The final takeaway from the Apple Card fine print isn’t too shocking. It’s that the Apple Card software is subject to change as Apple goes through iterations of its app and service.
However, that’s enough of a reminder that software, like services, change and mature. Apple Card’s terms and services could alter before it launches this summer, so if you are interested in signing up for a card, it’s a good idea to check the terms and conditions before signing on the digital line.
Published March 25 at 2:41 p.m. PT.
Update, 4:54 p.m. PT: Added details about Apple Pay Cash.