No, Apple Card is not a subprime lending crisis in the making

A scoop about Goldman Sachs’ new entry into retail lending went a little more viral than it deserved.

From Hugh Son’s “Goldman Sachs, bank of the rich and powerful, is dipping into subprime lending with Apple Card” posted on CNBC last week:

One new Apple Card customer, Ed Oswald, said his FICO score is about 620. The Reading, Pennsylvania-based copywriter said he had been using a subprime card from Merrick Bank.

“I was absolutely shocked I got it,” Oswald said. “I have a lot of collections from two or three years ago when I was in a really rough spot. When I heard it was with Goldman Sachs, I figured they were going for the high-income set.”

Oswald said Goldman is giving him a relatively modest credit limit of $750. He said his interest rate on the Apple Card, at 23.99%, is “a lot lower” than his other cards.

My take: I’ve asked Son how many Ed Oswald’s his reporting turned up. To me, his anecdote suggests that Goldman Sachs’ approval system might be working properly. Oswald’s terms—$750 max at the highest rate—are nothing to write home about.

Meanwhile, Apple and GS, I’m still waiting for the card I signed up for within minutes of its announcement and maybe a dozen times since.

Below: Son on CNBC last week.

Goldman Sachs is approving subprime credit scores for Apple Cards from CNBC.


  1. David Emery said:
    PED, maybe your credit reflects the dodgy income from this website 🙂 🙂

    August 12, 2019
  2. Aaron Belich said:
    Is Hugh Son the best banking reporter as Tony Sacconaghi is the best Apple analyst!?

    CNBC echo-chambers are dangerous places.

    August 12, 2019
  3. Gregg Thurman said:
    Non-AAA+ is not necessarily the same thing as “sub-Prime”. There’s a lot of grades between AAA+ and not, or barely, credit worthy.

    My credit rating is fairly low. That’s because since 2004 I’ve paid cash for everything (including my house).

    But it sure makes for a great headline, doesn’t it?

    August 12, 2019
  4. Fred Stein said:
    1) Apple bears no risk.
    2) GS takes on reasonable risk / reward.

    August 12, 2019

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