Apple is taking steps to develop its financial services capabilities by bringing various processes in-house, aiming to reduce reliance on external fintech partners, as reported by Bloomberg.
The tech giant has initiated a multi-year plan, referred to as ‘Breakout’, which involves handling payments processing, loan risk assessments, fraud analysis, credit checks, and customer service internally. According to Bloomberg sources, this initiative indicates a strategic move for Apple to deepen its involvement in financial services.
Recently, Apple made headlines by acquiring UK credit bureau Credit Kudos, known for using open banking technology to deliver precise credit scores. The focus of the Breakout project suggests Apple’s aspiration to expand its range of financial products.
Currently, Apple offers peer-to-peer payments, its Wallet app, a credit card, and a system for merchants to accept payments via iPhone. There are speculations about a potential subscription service for its hardware and a buy now, pay later (BNPL) product, which may leverage in-house technology.
Following the news, shares of Apple’s partners, CoreCard and Green Dot, experienced a decline of over eight percent, while Goldman Sachs saw a drop of more than one percent, despite reports indicating that the bank would continue its partnership with Apple for card services.
As Big Tech delves deeper into the financial services sector, challenges have arisen. Notably, Meta’s stablecoin project has faced significant setbacks in recent months, and Google has abandoned its plans for a checking account.