Lessons from the new Apple credit card

In an uncharacteristic Spring launch Apple has offered a variety of new non-device products including a Netflix-competing streaming service and the first credit card from the Apple stable.

And, the credit card is a crowd-pleaser. Titanium, white, laser-etched and iconic … it will have the immediate effect, for a while, when tendered that Amex Gold, iPhones and Blackberrys had when they were first launched. A touch of pizzazz at the flick of a wrist.

But, there is a game-changer in this which will become the industry-standard overnight. Take out your purse or wallet and have a look at any of your credit or debit cards. They are the financial equivalent of writing your password on a sticky note and putting it under your keyboard. On your card you’ll find your name, account number, CVV, digital swipe strip and signature.

It is the card without identity that carries a strong identity.

Apple have done what Apple does best, it has simplified the physical card and this will be copied by other card operators in a jiffy. Apple have removed everything from the card other than the chip & pin and your name. There is not even a contactless interface — Apple want you to use Apple Pay on your phone for that. And, removing contactless eliminates RFiD scanning risk.

Apple has given the idea to the rest of the market but this idea alone is not enough to allow Apple to capture a large market share of a market that is already exceptionally crowded. If you believe that “imitation is the sincerest form of flattery” then Apple are certainly destined to be flattered but whether they will become a market leader in credit cards remains to be seen.

The other offerings… cashback; no-fees; integration to wallet; Apple Pay two-factor authentication … are all fairly standard fare. It will grab the Apple-zealots, the early-adopters and some with a welcome 3% cashback on Apple products. Apple’s massive brand footprint is big enough that they will gain a natural market-share.

But, most importantly, it will grab the attention of their competition in this space, the other credit-card companies. This is a me-too industry, highly agile and competitive with a low-cost of change around this front-end. What does it take for an existing operator to strip their card back to the bare-minimum and remove all of the physical identify?

It is a balance of the security benefits against the restrictions when the payment interface is down or you want to use it in a location that doesn’t support chip & pin.

So… I expect to see quite a few of these wielded with a flourish. I expect to see plenty of similarly simplified offerings, I expect to look at today’s embossed credit cards in the same way as I would look at a credit-card imprinted carbon-copy. We have learnt how to simplify interfaces under Apple’s tuition and this is the next step on that journey.