Apple and Goldman Sachs have launched a new savings account that offers an annual yield of 4.15%, over 10 times the national average rate of interest. The new account is being offered to Apple's credit card users and has no minimum deposit requirements or fees. Customers can open an account with a maximum balance of $250,000, and deposits will be held with Goldman Sachs, which has access to FDIC insurance.
The launch of this savings account is seen as a response to the increasing pressure on smaller lenders and regional banks to offer better savings rates. In recent times, customers have been transferring their cash to higher-yielding products, such as money market funds, as traditional banks have failed to offer better returns in line with rising interest rates. The move by Apple and Goldman Sachs, therefore, provides an alternative to customers looking to get better returns on their savings.
In addition to the savings account, Apple's portfolio of financial services products has been expanded with the launch of a buy now, pay later program. While some observers have suggested that Apple is becoming a bank, Christian Owens, CEO of payments company Paddle, believes that Apple's real strength lies in its ability to earn money from hardware sales and non-banking services.
Overall, the launch of the new savings account is a significant move by Apple and Goldman Sachs to disrupt the traditional banking landscape, and it will be interesting to see how customers respond to this new offering.
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