Dive Brief:
- Tech giant Apple has added a virtual card number feature to its prepaid debit card which will enable users to make purchases anywhere that accepts debit cards, according to online reports.
- Previously, users could only use the prepaid card with merchants that accepted Apple Pay. Now, users will be able to generate a virtual card number for the debit card in the iOS digital wallet app.
- This feature was reported on earlier at the social network Reddit, and is available to pre-release testers of iOS. The software update with the feature is expected to roll out to all iOS users in early March, according to Apple news outlet 9to5Mac.
Dive Insight:
Cupertino, California-based Apple has been steadily investing in its payments business, even as it faces increasing regulatory and legal pressures. The tech giant has looked to payments, and its broader services category, to buttress slowing iPhone sales, its leading source of revenue.
Adding the virtual card number feature “is about giving options to consumers when retailers do not support Apple Pay,” Creative Strategies President Carolina Milanesi said in an email. Creative Strategies is a consumer technology research firm.
Apple did not immediately respond to questions about the new virtual card number feature for its prepaid debit card.
“Making the Apple Cash card more versatile and essential for daily spending habits aligns with Apple's broader strategy of locking users into its services ecosystem,” Consumer Reports Director Delicia Hand said in an email. Consumer Reports is a non-profit organization that performs consumer-focused research. “The more indispensable Apple products become for tasks like payments and banking, the more loyal Apple's customer base.”
Hand, who oversees responsible innovation in financial services and technology, expects to see the tech giant continue to beef up its digital debit card. “I'd expect Apple to add complementary financial features to Apple Cash over time - like budgeting tools, high-yield savings, credit-building, etc.,” she said. “Why stop with a virtual debit card?”
