Goldman Says It Plans to Allow Shared Household Apple Cards
Goldman Says It Plans to Introduce Shared Household Apple Cards
(Bloomberg) -- Goldman Sachs Group Inc. said it will introduce the ability for household members to share an Apple Card credit line after claims of bias in its underwriting process.
The Apple Card previously had individuals apply for their own cards. That led to controversy following social media postings in the past week by a tech entrepreneur and Apple Inc. co-founder Steve Wozniak complaining about unequal treatment of their wives in getting approved for credit lines.
One reason Goldman has become a poster child for the issue is that the Apple Card, unlike offerings from much of the industry, doesn’t let households share accounts. That could lead to family members getting significantly different credit limits.
Card sharing is a popular option because it allows family members to pool earnings and manage their spending from one account. For the bank, it’s a win-win. Usage of the card -- and the accompanying fees -- often go up after a customer adds an authorized user to his or her account.
Goldman said it doesn’t take gender or marital status into account when determining creditworthiness, but a top Wall Street regulator has said the bank is still responsible for any unintentional bias based on the decisions that its models spit out when arriving at credit decisions. The New York Department of Financial Services has said that it is undertaking an official probe.
Earlier Wednesday, Senator Ron Wyden, a Democrat from Oregon and ranking member of the Senate Finance Committee, said he’s looking into the validity of claims of bias against women in applications for the Apple Card.
“As companies increasingly rely on algorithms to handle life-changing decisions and outcomes, federal regulators must do their part to stamp out discrimination before it’s written into code,” Wyden wrote Wednesday on Twitter, saying that the “risks of unaccountable, black-box algorithms shouldn’t be underestimated.”
Goldman says it has the ability to identify which factors from an individual’s credit report contributed to a particular decision, suggesting that the black-box comparisons are unfair. The firm hasn’t indicated if it plans to offer greater disclosure on the weighting of various factors that contribute to a credit decision.
--With assistance from Jenny Surane.
To contact the reporter on this story: Sridhar Natarajan in New York at snatarajan15@bloomberg.net
To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Daniel Taub, Dan Reichl
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