Why Apple Is Shifting Its Card Issuer to JPMorgan: Banking Profit Meets Regulatory Strain

In 2019, Apple launched the Apple Card in partnership with Goldman Sachs, promising a pioneering product: no fees (late, annual, foreign transaction), a calendar-month billing cycle, wide approval—even for subprime credit scores—and tight integration with Apple’s Wallet and product ecosystem. These features resonated with consumers pleased by the simplicity and prestige. However, the deal from day one entailed trade-offs: revenue streams that are typical for issuers—late fees, foreign-transaction fees, steep penalties—were waived. The underwriting had to accommodate Apple’s insistence on “nearly all applicants,” pushing Goldman into riskier territory. Customer service burden was elevated by Apple’s requirement that all users have bill statements issued at the start of each month—concentrating complaint volumes and call center load.

Over time, the financial and regulatory consequences mounted. Goldman’s exposure to subprime borrowers drove up delinquencies and credit-loss provisions. Through 2023-2024, Goldman carried billions in losses from its consumer portfolio, including the Apple Card ecosystem; at the same time, regulatory probes and fines—most notably a CFPB enforcement in late 2024 totaling ~$89 million—highlighted customer service breakdowns, misleading terms in installment plans, delayed or dropped dispute handling, and misreporting to credit bureaus.

Negotiations toward a replacement issuer began as Goldman scaled back its consumer banking ambitions. Apple solicited bids from major banks and even fintech or private-credit firms. JPMorgan emerged as the leading candidate and finally agreed in early December 2025 to acquire the $20 billion loan portfolio from Goldman—at a ~7% discount—after pushing for protection clauses to guard against worsening credit metrics before closing. The transition is expected to last about two years.

Strategically, this move offers Apple an opportunity to reset operational burdens and reputational risks, while maintaining its services offering. For JPMorgan, the deal deepens its dominance in consumer finance, acquiring a recognized product and large customer base. For Goldman, it represents a retreat from retail consumer banking failures—closing its Platform Solutions unit, dropping card partnerships (Apple Card, GM Card), and refocusing on its traditional revenue drivers. Regulatory relief also likely follows, especially given CFPB and Fed scrutiny.

Open questions remain: how will JPMorgan manage margins given Apple’s terms? What changes (if any) will Apple demand in its next issuer contract? How will this affect cardholders—interest rates, rewards, service? And what lasting lessons will other tech-bank co-branding arrangements learn from this high-profile exit?