Apple Card takes 'digital-banking battle' to new level

The Apple Card is here, and it’s shaking up digital banking.

Apple on Tuesday announced the official launch of its shiny, new titanium credit card, which features software tools from Goldman Sachs, and gives users the ability to track spending decisions by breaking them down into different categories. The card offers cash back rewards, and aims to have among the lowest rates in the industry.

“The release this month of Goldman’s new co-branded credit card with Apple should reflect the industry moving to a new level in the 21st-century digital-banking battle,” Wells Fargo analyst Mike Mayo wrote in a note to clients out earlier this month.

“Goldman’s ability to start a business from scratch and partner with such an iconic brand should reflect its potential to out fin-tech the fin-techs and out-bank the banks.”

While Mayo praises Goldman for its innovation he warns the “jury is likely to remain out” in regards to the bank's return on investment as the Apple Card likely won’t make up more than 1 to 2 percent of its earnings in the next two to three years.

But that hasn’t stopped Goldman Sachs CEO David Solomon from gushing about the untapped potential the card presents for his bank's business.

“With no real legacy technology or a longstanding consumer business to defend, we are positioned to innovate unlike many others in the industry,” Solomon said Tuesday in an internal memo obtained by CNBC.

“In the decades to come, I expect us to be a leader in our consumer business, just like we are in our institutional and corporate businesses, with customer-centricity at the core of everything we do.”

And while Mayo says the opportunity is there for Goldman to penetrate into Apple’s customer base, he also thinks there’s some risk.

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“If the card balances grow too quickly, there could be questions about credit risk and adverse selection,” he warned.