Over the weekend, there was some noise that started on Twitter from one consumer and then eventually included the co-founder of Apple, Steve Wozniak. The noise was about the new Apple Card and how it had apparently granted 10-20 times the credit line for the husband over what the wife had received.
Why The Apple Card Is Being Investigated
A Few Reports of Husbands Being Given Much Higher Lines of Credit Than Wives – With all Being Equal
Steve, who says that he and his wife’s financial information is identical, says he had received 10 times the credit limit that his wife had. The original poster on Twitter said he received 20 times the credit limit, in spite of the fact that his wife had a better credit score than he had!
How Credit Card Applications are Handled
When people apply for credit cards, computers run the numbers that are available on the applicant to see what kind of customer they would be and what kind of risk would be taken by the bank, should they accept that applicant as a credit card customer. There are a variety of metrics checked with things like overall credit lines, credit utilization amounts, open lines of credit, and more that are involved. Many of those factors are included in the makeup of the individual’s overall credit score.
Apple has detailed here about how the Apple Card application is handled but there is also a level of AI (artificial intelligence) involved with the assignment of accounts and credit line. So, it is most likely that AI is at fault and that Goldman Sachs and the Apple Card are not actually giving women lower credit lines than men. This would also seem to be the case when the original individual that had made this online complaint said that Goldman Sachs hiked his wife’s credit line way up after the complaint – without asking for any additional documentation. In addition, they deny that they use the sex of the applicant as a means of giving credit lines.
Goldman Sachs and Apple Card Being Investigated
Goldman Sachs has said that the Apple Card was the most successful credit card launch ever and that they had issued over $10 billion in lines of credit. So, this is a big deal for both Apple and Goldman Sachs. However, this issue is now under investigation by the New York State Financial Services department to see if there had been any discrimination involved in the processing of applications.
Artificial Intelligence Involved – Good Thing or No?
While Apple is constantly leaning on the security of customers’ information and the assurances that they do not have access to information like Health and more, this instance may start causing some to wonder about the idea of AI being involved with certain decisions like this.
For example, who would have thought a few years ago that it would be a good idea to have a device that handles your health information, location information, shopping information, and more also be responsible for the application of a credit card and the issuing of it? I mean, when you think about it, imagine if companies that issued credit cards were able to have access to things like where you shopped, where you traveled, where you went, what your basic health stats were and more. If all of that information was spilled into an algorithm for a credit card application, would that make some people take a pause?
I am not saying at all that this is what happened here but it is curious to see how all of this information is quickly becoming centralized and that it resides on a device in our pockets. Hopefully companies will treat this personal information as belonging to the customer and not trying to start using it for all other things – like credit card applications.