JPMorgan $JPM Chase is in “advanced talks” to run Apple $AAPL’s credit card business, people familiar with the matter told the Wall Street Journal on Tuesday.
Apple reportedly told the U.S. bank that it is the tech giant’s “preferred choice” to take over the reins of its credit card program.
The two have been in talks since early last year, but no deal has been signed yet, the Journal reported.
Currently, Apple partners with Goldman Sachs $GS to run its credit card program. However, the Journal first reported back in November 2023 that Apple sent a proposal to the bank to cut the partnership off in the following 12 to 15 months. Goldman’s proposed exit would cover all aspects of the agreed-upon partnership, which included Apple’s credit card program and savings program.
Goldman CEO David Solomon said during the company’s earnings call in January that the bank’s partnership with Apple is meant to last until 2030, but it could end sooner than expected, Reuters reported.
This new deal between Apple and JPMorgan would have the bank take over the credit card program from Goldman. Apple initially was considering other partners, including American Express $AXP, Synchrony $SYF, and Barclays, but those other contenders didn’t pan out, people familiar with the matter told CNBC.
Apple and Goldman Sachs first paired up in 2019 to launch the Apple Card. Last fall, the partners were ordered by a federal regulator to pay more than $89 million in redress and penalties for failures related to the card.
“The CFPB found that Apple failed to send tens of thousands of consumer disputes of Apple Card transactions to Goldman Sachs, and when Apple did send disputes to Goldman Sachs, the bank did not follow numerous federal requirements for investigating the disputes,” the Consumer Financial Protection Bureau said in a statement.
It said the two companies launched the card despite “third-party warnings” to Goldman Sachs that Apple’s payment disputes system wasn’t ready. The result meant consumers often had to wait too long to get money back from disputed charges, the CFPB said.
The CFPB also said that Apple and Goldman Sachs misled consumers about interest-free payment plans for Apple devices, charging consumers interest when they thought they wouldn’t be charged.
The bureau ordered Goldman Sachs to pay at least $19.8 million in redress and a $45 million civil penalty. It ordered Apple to pay a $25 million civil penalty.
—Ben Kesslen contributed to this article.