Keywords: buy now – pay later
LONDON, June 9 (Reuters) – Tim Cook has crossed the banking divide. Big U.S. tech firms have so far largely kept out of the lending business. But on Monday Apple’s (AAPL.O) chief executive unveiled plans to use the $2.4 trillion company’s balance sheet to offer “buy now, pay later” loans to iPhone users. The push into financial services will keep traditional banks on their toes.
Apple has played around the fringes of finance for some time. Its Apple Pay service allows customers to use their devices to make swift payments. And in 2019 the company launched a credit card with much fanfare. The key difference this time, however, is that its Apple Financing subsidiary is making the lending decisions and will fund the loans with the backing of its parent company’s balance sheet, which included $193 billion of cash and securities at the end of March. Goldman Sachs (GS.N), the lender behind Apple’s credit card, will in this case serve as the bank sponsor that allows Apple to access the Mastercard (MA.N) payments network.