Afaik, processing fees for higher-volume vendors are below 3% and kick-backs to consumers tend to be 1-3%. Is there much margin left for VISA, the bank, and Apple to share? Can anyone here can speak to this from inside experience?
There's also the revenue on interest for people who keep a balance (often 10-30% apr). I don't know how much would go back to Apple after the default risk, but its something to keep in mind for unit economics.
i don't know the numbers for each, but my understanding is that processing fees are paid to the card provider (visa or mastercard) and interest is paid to the issuing bank. visa isn't making money off the interest, and your bank isn't making money off the fees.
Makes sense, Visa isn't a bank per se so they don't want to carry the default risk and make worthiness decisions. I wonder what the split between Goldman Sachs / Apple is.
