In a recent development, Apple is reportedly in discussions with JPMorgan Chase to transfer its flagship credit card program from Goldman Sachs, according to a source familiar with the negotiations. While the discussions are still at an early stage, key details such as the price and whether JPMorgan would continue specific features of the Apple Card are yet to be determined.

The negotiations between Apple and JPMorgan could potentially face hurdles and may not ultimately materialize, the source stated while requesting anonymity. However, this move highlights the limited options available to Apple after Goldman Sachs shifted focus away from its struggling retail banking strategy. With only a handful of card issuers in the United States capable of taking on the Apple Card program, JPMorgan emerges as a strong contender, being the country's largest credit card issuer by purchase volume, according to the Nilson Report.

One of the key factors impacting the discussions is the valuation of the Apple Card's outstanding loans, which currently amount to approximately $17 billion. JPMorgan is aiming to pay less than the face value due to elevated losses associated with the card. Goldman Sachs argues that the higher-than-average delinquencies and defaults on the Apple Card are primarily a result of new accounts and should gradually decrease over time.

In addition to the valuation, JPMorgan is also seeking to modify certain aspects of the Apple Card program. Specifically, they aim to eliminate the calendar-based billing feature, which sends statements to all customers at the beginning of each month, leading to a surge in customer service inquiries. While this feature appeals to customers, its removal would alleviate the increased workload for service personnel.

Both Apple and JPMorgan Chase declined to comment on the ongoing negotiations, which were initially reported by the Wall Street Journal. Nevertheless, this potential partnership highlights the challenges faced by Apple in finding a suitable replacement for Goldman Sachs as they navigate the credit card landscape.