Apple's branded credit card does things differently from some of the traditional cards we cover at TPG. Instead of providing rewards in the form of loyalty points, the tech giant's Apple Card gives users cash back as part of what it calls Daily Cash.
Starting in the coming months, your cash back will be able to be automatically deposited into a new high-yield savings account from Goldman Sachs, Apple announced today.
How it will work
As you accrue interest, your available cash will grow over time, depending on the interest rate available when you sign up for an account.
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You'll be able to open this new savings account directly from your iPhone in a future iOS update. It will have no fees, no minimum deposits and no minimum balance requirements, according to Apple. Only Apple Card owners and co-owners will be eligible for this new savings account.
Neither Apple nor Goldman Sachs, which also issues the Apple Card, provided the interest rate for the new savings account, but I imagine we'll learn more about it as the account offering gets closer to launch. Right now, Goldman Sachs offers a 2.15% annual percentage yield for its high-yield savings accounts through Marcus.
When this new feature launches, you'll be able to choose your preferred destination for your cash back directly in the Wallet app on your iPhone. If you choose a savings account, then you'll automatically start accruing interest on your Daily Cash with no additional steps or fees involved.
You can also top off this new savings account with additional funds from other sources in addition to your Daily Cash balance; this includes money from a linked bank account or from your Apple Cash balance.
Plus, you'll be able to withdraw funds at any time without any fees. Managing your savings account will be possible from a new savings dashboard that will include your account balance and interest accrued over time.
With the Apple Card, there's no limit to the amount of cash back you receive, and the bonus categories are simple and easy to understand. You receive:
- 3% Daily Cash on purchases made using Apple Pay with Apple and select merchants, including Uber and Uber Eats, Walgreens, Nike, Panera Bread, T-Mobile, ExxonMobil and Ace Hardware.
- 2% Daily Cash when using Apple Pay at other merchants.
- 1% Daily Cash on all other purchases.
Bottom line
Historically, cash back from the Apple Card went directly into the Apple Cash account that's linked to your device and Apple ID. From there, you could transfer the money into a linked bank account. From your bank account, you could invest the money as you see fit.
However, with Apple’s innovative new high-yield savings solution launching soon, it’ll be much more seamless to earn interest on your cash back. This new savings account partnership with Goldman Sachs will launch in the coming months in a future iOS update, and we'll be sure to update this story when more details are available.
This is the latest new feature to come to Apple's iOS Wallet experience. Earlier this year, Apple unveiled a new buy now, pay later option — dubbed Apple Pay Later — that'll become available for all iPhone users. This feature was originally supposed to debut with the release of iOS 16, but it's now coming in a future iOS update, according to Apple. With Apple Pay Later, you'll be able to split any Apple Pay purchase into four payments over six weeks with no interest or fees.
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October 14, 2022 at 01:03AM
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You'll soon be able to earn interest on the cash back from your Apple Card - The Points Guy
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