Apple’s credit card got a lot of attention when the company first unveiled it earlier this year, not least because it showed how U.S. tech giants are looking to make waves in the financial services.
But according to a Russian bank executive, there’s little more to the Apple Card than what’s on the surface: a credit card and a digital wallet to support it.
Apple’s foray into banking was met with much fanfare thanks to a speedy application process and offer of 3% cash back on some goods and services. But the cards are actually issued by Goldman Sachs, as Apple doesn’t have its own bank license.
Apple hasn’t been alone in trying to take on retail banking. Google recently said it plans to offer checking accounts, and is partnering with Citi and a U.S. credit union to provide them. On the other hand, established banks have been partnering with and investing in smaller fintech competitors to combat the threat from Big Tech.
Rafalovsky said he challenges anyone “to give me an example of great ground-breaking innovation in consumer banking,” taking a swipe at Apple and some of the financial technology upstarts that have built app-based bank accounts that don’t charge any fees.
Sberbank’s tech chief used the analogy of Italian food to demonstrate his point. He said that restaurants both good and bad use the same ingredients and recipes to make their food, and that banks and fintech firms are “all investing, more or less, in the same ingredients.”
“How do you innovate if everyone is using the same ingredients on the table?” Rafalovsky said. “What will make your end product better than your competitors?”
What financial institutions should focus on, he said, is the “intersection of financial and non-financial services,” putting customers at the center of product development.