Why Apple is shaking the banks according to Nicastro (ex Unicredit)
According to Nicastro, Apple risks not being the only Big Tech to launch a harsh attack on the credit market: "It could be imitated by Google/Android which have about 3 billion users worldwide"
The bitten apple bites the banking world . It obviously did not go unnoticed by market players that Cupertino presented its savings account (Apple Savings) with an annual yield of 4.15%. It does not require a minimum deposit, there is no constraint and users can open it directly from their iPhone Wallet. The account is launched in collaboration with Goldman Sachs and is currently reserved for US customers with an Apple Card. "Has Apple finally become a bank and a formidable enemy for retail banks?" is the question that has been appearing on the profile for a few hours LinkedIn of Roberto Nicastro , general manager of Unicredit for 18 years, today founder and president of Banca AideXa: «My opinion is: yes, Apple is increasingly becoming the nightmare competitor for banks and other financial operators, not because it will a Bank (it may never become one), but because it is now radically and undeniably redefining retail banking as we know it, and perhaps evolving its customer banking interface into the primary gateway for retail banking services».
ACCESS TO ONE BILLION USERS
The former Unicredit chief executive points out that this fact represents «an important disruption in retail banking, which had been foreseen for a long time. Now it's coming true and it's based on Apple's easy access to over 1 billion customers, superior and smooth user experience (UX), transparent and secure, Apple's long-earned customer trust, massive resource availability and on the well-targeted choice of intelligent partners for various initiatives».
NICASTRO: GOVERNMENTS TO INTERVENE ON APPLE
According to Nicastro «Regulators and Governments must take note, monitor and possibly react, since the risks for competition in retail banking services and the excessive concentration of power deriving from the customer's "share of total data" are evident. The reaction of incumbent banks will require substantial changes in business models and technological architecture. Fintechs also have to adapt to the new environment, possibly repositioning themselves or collaborating with other players in this new ecosystem».
THE THEME OF DATA
As for the near future, «What else – Nicastro always wonders – could be boiling in Apple's pot? Following the Kudo acquisition, it may finalize plans to offer consumer lending products or related services in the UK and European banking markets. Apple could easily access an unrivaled pool of data, add financial information to its already huge set of customer information, and thus develop the most sophisticated credit scoring imaginable. The loan portfolio generated by Apple could then be securitized and sold to institutional investors. The next big challenge could be the offer of checking accounts, where Apple has already taken a first step with Apple Wallet.
THE COMPETITION TO VISA, MASTERCARD AND PAYPAL
For Nicastro «with Apple Savings, consumers will find it easier to obtain a competitive rate on cash deposits, thus reducing one of the most significant profit streams for banks (deposit markdowns). Additionally, by using Apple Pay and Apple Tap to Pay to close the loop on many transactions, Apple could significantly threaten the vast revenues of Visa, Mastercard and PayPal (currently the world's largest retail banking players by market capitalization). ). It's worth noting that Mastercard is an important partner for Apple Pay Later. Furthermore, in the consumer loan and mortgage sector, it could beat the banks not only in terms of access to customers, but also in the richness of credit scoring ».
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/perche-apple-sta-facendo-tremare-le-banche-secondo-nicastro-ex-unicredit/ on Mon, 01 May 2023 05:13:33 +0000.