First Apple revolutionized the personal computer industry with the iMac. Then Apple redefined the cellphone industry with the release of the iPhone. Now, Apple has set its sight on the payments industry. The tech giant released its first credit card—the Apple Card—on August 20, with Goldman Sachs as the issuing bank. The card was designed to be primarily used with Apple Pay on Apple devices, but the tech giant did release a flashy titanium physical card. While many companies have released their own credit cards, Apple’s approach has drawn much buzz due to the card’s lack of fees, quick onboarding process, and sleek mobile app experience. For its part, Apple marketed the card with the line “Created by Apple—not a bank,” signifying how it’s seeking to disrupt the banking landscape. To better understand what the Apple Card brings to the payments space, and how issuers should respond, PaymentsJournal sat down with Bharghavan Vaduvur, CEO of OnDot, and Aaron McPherson, VP of Research Operations at Mercator Advisory Group. Vaduvur and McPherson discuss the importance of the Apple Card’s emphasis on a mobile app, the potential impact on small banks, and how issuers can stay competitive against the global tech giant. PaymentsJournalHey Issuers, Big Tech Is Coming. Here’s How to CompetePaymentsJournal Hey Issuers, Big Tech Is Coming. Here’s How to CompetePaymentsJournaljQuery(document).ready(function ($){var settings_ap22437629 = { design_skin: "skin-wave" ,autoplay: "off" ,loop:"off" ,cue: "on" ,embedded: "off" ,preload_method:"metadata" ,design_animateplaypause:"off" ,skinwave_dynamicwaves:"off" ,skinwave_enableSpectrum:"off" ,skinwave_enableReflect:"on",settings_backup_type:"full",soundcloud_apikey:"" ,skinwave_comments_enable:"on",settings_php_handler:window.ajaxurl,skinwave_wave_mode:"canvas",pcm_data_try_to_generate: "on","pcm_notice": "off","notice_no_media": "on",design_color_bg: "111111",design_color_highlight: "ef6b13",skinwave_wave_mode_canvas_waves_number: "3",skinwave_wave_mode_canvas_waves_padding: "1",skinwave_wave_mode_canvas_reflection_size: "0.25",skinwave_comments_playerid:"22437629",php_retriever:"https://www.paymentsjournal.com/wp-content/plugins/dzs-zoomsounds/soundcloudretriever.php" }; try{ dzsap_init(".ap_idx_82814_9",settings_ap22437629); }catch(err){ console.warn("cannot init player", err); } }); It’s not just a store card for Apple Music or the App Store One of Apple’s defining characteristics is its focus on the customer experience. Now the company is applying this to the payments industry. “This is really the first time a tech giant that anchors its entire existence on understanding the consumer experience is getting into a payment card issuer space,” said Vaduvur. Because of this, Vaduvur believes that Apple’s foray into payments is a big deal. It has the potential to redefine how customers interact with their payment cards, he said, regardless of how much of a market share Apple eventually commands. McPherson identified specific ways in which the card is changing the relationship between cardholder and card. First, the application process for getting the card is seamless and quick. Second, the card is issued instantaneously and goes straight into the digital wallet. This means that within minutes, a customer can get approved for the card and start using it right away. The other notable aspect of the Apple Card is the mobile-first orientation. McPherson pointed out that users only get 1% rewards