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Apple is still trying to figure out how to disrupt finance

Kwan Wei Kevin Tan   

Apple is still trying to figure out how to disrupt finance
  • Apple discontinued its buy-now, pay-later service on Monday.
  • It's planning to launch a new suite of Apple Pay features later this year.

It looks like Apple is still having a hard time figuring out the best way to disrupt the world of finance.

On Monday, the iPhone maker told 9to5Mac it was discontinuing its buy-now, pay-later service, Apple Pay Later, just months after it was rolled out across the US.

In its place, the company is betting on a new suite of Apple Pay features that will be launched later this year. These features include "access to installment loans offered through credit and debit cards, as well as lenders" such as Affirm.

"With the introduction of this new global installment loan offering, we will no longer offer Apple Pay Later in the US," the company said in a statement to 9to5Mac.

Its plans to introduce new Apple Pay services later this year show that it still has serious ambitions to provide financial services to its user ecosystem.

Apple, after all, has been busy building up a multibillion-dollar services arm in recent years that aims to cater to all digital needs of users plugged into its devices, be it sorting out their entertainment fix through Apple TV+, or helping them keep on top of key fitness markers with Apple Health.

So, providing services that support their financial needs seems to be a bold but understandable ambition for CEO Tim Cook.

That said, Apple rarely drops a feature as quickly as Apple Pay Later was dropped — a sign that the company is having difficulty landing on a financial services solution that gets considerable buy-in from its user base. Apple Pay Later allowed users to split their purchases into four, interest-free payments over a period of six weeks.

This isn't the first time Apple's ambitions in the world of finance have taken a hit.

Late last year, reports emerged that Apple's partnership with Goldman Sachs was in jeopardy. The companies had joined forces to offer an Apple-branded credit card in 2019, followed by a high-yield savings account in 2023.

It's unclear whether Apple will seek another financial-services partner, though the chances of that happening appear slim.

Representatives for Apple didn't immediately respond to a request for comment from Business Insider.

Disrupting is a tough business

Apple's travails in the financial services sector underscore the immense challenges it can face when trying to disrupt an established industry.

The Cupertino giant previously had an enviable track record for disruption — whether it was in the music industry with the iPod and iTunes or when it reinvented the phone with the iPhone.

But Apple's recent attempts at innovation haven't hit the same bar.

For one, the company's attempt at a mixed-reality headset, the Apple Vision Pro, was met with muted sales and middling reviews.

And if that wasn't enough, Apple said in the same month that it was pulling the plug on its electric-car project after working on it for nearly a decade.

The late Steve Jobs once dreamed of reinventing the television, telling his biographer Walter Isaacson: "It will have the simplest user interface you could imagine. I finally cracked it."

It's been more than a decade since Jobs died, and while no television has emerged, the company has produced a popular set-top box, Apple TV, and created the Apple TV+ streaming service.

To be sure, disruption is tough, even for a trillion-dollar tech behemoth such as Apple. But the company could increase its chances of success by sticking to what it knows best — making great consumer-facing technology.

While some may view Apple as a laggard in AI, it's managed to charm the markets with its vision of practical and user-centric AI tools.

Much could still happen down the line, but offering a highly personalized and seamless AI service is right up Apple's alley.

Correction: June 18, 2024 — An earlier version of this story misstated the year Apple began offering a high-yield savings account with Goldman Sachs. It was 2023, not 2022.


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