Apple is stepping more into finance with an update on the iOS 16. Upon the new operating system launching, users will have access to the Pay Later service which is part of the Cupertino giant's plan to handle lending decisions on its own.
Apple is Creating a Subsidiary Called Apple Financing
According to Bloomberg, Apple made the decision to establish a subsidiary that it calls Apple Financing. The subsidiary will assist Apple users by conducting credit checks as well as handling customer approvals.
The Apple Financing firm is expected to operate separately from Apple but it has already been able to get the needed state licenses in order for the feature to be offered. This, however, isn't the first time the Cupertino giant hasn't dabbed into financial services.
Cupertino Giant Plans to Launch Pay Later
The previous financial services by Apple were done with the help of institutions just like Goldman Sachs. As per the story by Engadget, the investment bank will also be part of the newer move by Apple, Pay Later.
Bloomberg notes that the firm will be the one to issue Mastercard payment credentials that will be used by customers in order to complete purchases. Goldman Sachs, however, won't be handling both the lending and credit assessments just like how it does with the Apple Card as detailed more on CNBC.
Apple is Planning to Lessen Dependence to External Suppliers
As seen in Apple's move toward the financial space, the company looks like it is trying to replicate a strategy that has once served them well in the past. The company reportedly invested a significant amount of time and money in order to develop in-house versions for a lot of the components that are used to power both its computers and mobile devices.
Outside of focusing on helping make its products more attractive to customers, the strategy has been able to help Apple lessen its dependence on certain external suppliers just like Intel. Another reason why the Cupertino giant is doing this is to also increase its revenue.
Apple is Working on Its Own Payment Process Engine
Engadget notes that it looks just like Apple is hoping to achieve a much similar outcome when it comes to the financial services front. As per Bloomberg, the company is also working on its very own payment processing engine as part of a certain initiative called "Breakout."
The company is also developing certain tools to be used for fraud analysis as well as interest calculations among a few other customer-facing features. As with the Cupertino giant's push directly into subscriptions with certain services like TV+ as well as Fitness+, the article by Engadget notes that the company will likely be seeing those efforts as a way to keep owners of the iPad, iPhone, and Mac customers tied to the whole Apple ecosystem.
This article is owned by Tech Times
Written by Urian B.
