Is The Apple Credit Card Sexist?

Filed Under: Credit Cards

The Apple Credit Card was introduced over the summer, and has been immensely popular. Personally it’s not a card I have much interest in, because it’s not that lucrative for someone who is good at maximizing rewards.

However, we all know that Apple has a loyal following, and given the easy sign-up process and sleek marketing, it’s not surprising so many people have picked up this card.

Accusations Of The Apple Card Being Sexist

There is now widespread discussion about whether the Apple Credit Card is sexist, to the point that this is now being investigated by regulators.

All of this started on November 7, when tech entrepreneur David Heinemeier Hansson Tweeted the following:

The @AppleCard is such a sexist program. My wife and I filed joint tax returns, live in a community-property state, and have been married for a long time. Yet Apple’s black box algorithm thinks I deserve 20x the credit limit she does. No appeals work.

He didn’t stop there, and has Tweeted more than a dozen times about this. Then Apple co-founder Steve Wozniak got involved, sharing a similar data point:

The same thing happened to us. We have no separate bank accounts or credit cards or assets of any kind. We both have the same high limits on our cards, including our AmEx Centurion card. But 10x on the Apple Card.

Obviously isolated data points as such don’t make something true, but looking at the responses to their Tweets, it seems like a lot of people have had similar experiences.

Of course there’s potentially some level of confirmation bias, especially for those who don’t understand how credit limits are assigned, and how credit scores work. But something doesn’t seem to be adding up here.

Regulators Are Investigating The Apple Card

New York’s Department of Financial Services has now contacted Goldman Sachs (which runs the Apple Card), and plans to investigate. As the DFS said in a statement:

“We will be conducting an investigation to determine whether New York law was violated and ensure all consumers are treated equally regardless of sex.

Any algorithm that intentionally or not results in discriminatory treatment of women or any other protected class violates New York law.”

Meanwhile Goldman Sachs said the following in a statement:

“Our credit decisions are based on a customer’s creditworthiness and not on factors like gender, race, age, sexual orientation or any other basis prohibited by law.”

Could There Be Merit To This?

Not surprisingly, this has generated a lot of controversy on Twitter. Looking at the comments on the discussion, people seem to fall into one of two general camps:

  • Many people had similar experiences, or agree that this is clearly part of systematic discrimination
  • Many people are telling the soy latte drinking, virtue signaling, liberals to be quiet

Actually, I guess that describes just about every Twitter thread. 😉

As much as Hansson and Wozniak are brilliant guys, this isn’t really the area in which they specialize. For example, Wozniak talks about how his wife has the same high credit limit as him on the Amex Centurion Card, though in reality the card has no pre-set spending limit, so in that sense everyone has the same limit on the card. 😉

What Can Impact Your Credit Limit?

With the above out of the way, what can actually impact the credit limit you get on a card? Ultimately this is proprietary information, and every card issuer has a different formula.

However, there are a variety of factors that potentially come into play:

  • Your credit score
  • Your income
  • The length of your credit history
  • Existing debt
  • Your existing credit lines
  • Macro economic forces, like the state of the economy, etc.

Your credit score factors in many of the other things that could impact the credit limit you’re given. But there’s not full overlap.

It seems like many of these things should be factored in, based on the data points we’re seeing:

  • Married couples with joint bank accounts should have similar combined incomes
  • Many husbands are reporting that their wives have credit scores that are as good or better than their own credit scores

The only obvious potential wildcard that I don’t really see addressed is how the overall available credit compares between spouses. If you and your spouse have the same credit score, similar credit history, the same combined income, same debt (or lack thereof), etc., the one major factor that leaves is your overall available credit.

In other words, all else being equal, if you have a total of $20,000 of available credit across your cards, and your spouse has a total of $200,000 of available credit across all of their cards, it’s logical that they would be given a lower credit limit, since they’re already more “exposed.” But I don’t see anything one way or another indicating whether that’s the case.

Bottom Line

I’ll be curious what comes of the investigation as to whether or not the Apple Card’s algorithm is sexist. Unfortunately this would be far from the first time that an algorithm like this discriminates based on gender, race, etc.

We can’t say with certainty that the algorithm is sexist based on the data points (so far), but it sure seems to me like there might be something to this. It’s one thing if many wives were getting mildly lower credit limits than their husbands (which could be attributed to a variety of factors), but the number of data points we’re seeing of exponentially different credit limits is alarming…

Comments
  1. A card can’t be sexist. Maybe change the title to reflect it’s really Goldman Sachs that’s being accused.

  2. @QueebLanie – Maybe we should start discussions on long time systematic sexism against men, in this country, on things that matter a lot more than how big of a credit limit you get on your titanium Apple Card. Like selective service and car insurance rates. It’s 2019, wake up, gal.

  3. @ Colin…hmmmm, maybe men pay higher insurance rates because there is evidence to suggest that they cause more accidents (source: Insurance Institute for Highway Safety)? Not to mention that men’s salaries still far outpace women’s salaries ($.79 per every $1.00 a man makes – source: literally dozens) so they can actually pay more? And could women being excluded from the selective service have to do with sexist ideologies that suggest women aren’t “strong” enough to fight, and that they may “distract” men during war time, which have been the excuses MEN in power have used for decades to exclude them from service? Poor, poor men! We are so oppressed…

  4. I’d be more pissed if I fell for the marketing campaign and got a substandard card like the Apple Card.

  5. @Ralph – Thanks for proving my point.

    Because I guess the same logic doesn’t hold true for heath insurance, even if women statistically have higher costs, because that’s already against the law.

    And what if the banks had stats that indicated women default on loans at a higher rate than men…then would they be allowed to discriminate?

    But go ahead and continue advocating for discrimination only when it suits YOUR narrative.

  6. And nice try with the “wage gap” argument. It’s been debunked so many times that not even mainstream media cites it anymore. You have to go FAR into the ether to the likes of Vox and Buzzfeed to still be hearing about it. Or I guess you.

  7. Shout-out to Colin for disproving the silly outdated stereotype that women are the only ones who get hysterical

  8. It’s mind-boggling that there are people who actually don’t believe sexism exists. I mean, obviously there are going to be *some* situations where women are at an advantage to men in our complex world, but to deny that men are at an advantage the majority of the time? It’s delusion, or hatred, or insanity. You really have to be exceptionally stupid or emotionally compromised. I welcome an impartial investigation by regulators, because while Ben raises plausible unbiased explanations for these discrepancies, it is nonetheless plausible that these algorithms are reflecting some real biases.

  9. @colin, @joe, @ben l:

    Fully agree, and I suggest we also start a new campaign – “Billionaires Lives Matter” – to protect such a minority, appressed group.

    Sad to see such a blind devotion to fox news and their agenda (which by the way, does not benefit you…)

  10. Hahaha
    No matter what kind of ideology one follows, a correctly implemented computer algorithm that runs over a big dataset will give you the real, unbiased and objectively correct result.
    If it contradicts the ideology, one should question the ideology and not start crying over the result.

  11. Well, a credit card can’t be sexist…. so no….
    But the people who programed the algorithm? Maybe, who knows.

    But in all honesty, there are so many factors that go into a credit line. The women who received lower credit limits, maybe they have taken a lot more credit out? Maybe they had a bad reputation with Goldman Sachs? Maybe it’s because women have more debt than men on average? (I don’t think this is the right way to calculate someone’s credit worthiness since you should judge each borrower individually, but maybe Goldman Sachs doesn’t?) I guess we will have to wait and see….

  12. Seems like this is one of those things where people shouldn’t run off and jump to conclusions of sexism. Would be surprised if in this day and age they were using algorithms to discriminate against women. Regulators can go ahead and investigate to see, but maybe people should wait for the results of an unbiased investigation before making random speculations.

  13. @Max

    I don’t think anyone’s questioning whether the algorithm worked as it was designed to. The question is whether it was designed to produce prejudicial results. This depends on what ideological biases underlie the algorithm. There’s no such thing as an “unbiased” or “objectively correct” algorithm, as a large and growing body of research on algorithmic bias demonstrates.

  14. I can’t comment if Apple is sexist, but I believe the brand is elitist. In my opinion, and based on many years of use, the Apple brand seems to only be focused on forcing the consumer into spending money when it is not necessary.

  15. @Ralph4878

    “Not to mention that men’s salaries still far outpace women’s salaries ($.79 per every $1.00 a man makes – source: literally dozens) so they can actually pay more?”

    Ah, this makes sense! It must also be the reason Apple is offering more credit to men. They earn more, so they can pay more. This is objectivity, not sexism.

  16. @Stuart: Exactly. The Apple card discriminates against both the Mastercard Black Card and the Amex Black card. It also discriminates against oranges, bananas and even rambutans. It is clearly a white supremacist fruit card.

  17. I currently have 11 cards with a total available credit limit of $230k. As a single woman, I might be getting higher spending limits than I would if I were married. I’m not saying that’s a correct policy but I understand why the banks would do it. Basically they’re issuing a credit limit based on (combined) household income and if one of the parties has a high limit, they would probably want to limit their exposure on the spouse’s card, regardless of sex.

  18. @Ben/@Max

    The algorithm may do perfectly what it’s supposed to, but if the data or the assumptions going into the algorithms are biased then the results will be similarly biased.

    Also, I think people are conflating intentional bias (discrimination) from unintentional bias, which is often a “byproduct” of the algorithm. A common example is when you use income as a criterion in algorithms, you invariably end up biasing against women and minorities at the expense of white men because their incomes are on average lower. That doesn’t mean you intended to discriminate or that the algorithm is wrong, but it means you have to be aware of / calibrate such biases in the model.

    Long story short; I can totally see the Apple algorithm producing such biased results even if that was not the intent.

  19. Everyone who thinks Men and Women act the same way and are completely equal: Get a prescription for an estrogen blocker + testosterone injections. Wait 10 days and you will be convinced that there is a difference in price way of thinking and behavior.

    However even if though men and women are not equal, they still have the same value: It takes one’s man and one woman to conceive a child. So the best thing is to cooperate and combine the individual strengths together.

  20. @ Ben L – no one is hysterical in here. But keep using sexist language to prove your point that sexism isn’t real – totally works!

    @ Colin – please provide some sources with empirical evidence that the pay gap is a myth if you want anyone to take you seriously in here

  21. Don’t care for two reasons:

    1) It’s not a good reward card.

    2) I have a penis.

    People should be more offended that they are gullible enough to fall for the apple marketing and get an inferior reward card.

  22. I’m wondering which spouse applied for their card first. It’s possible that the second spouse to apply gets a lower limit, if Goldmans is trying to limit their exposure in a single household.

  23. @colin you complain about Vox and buzzfeed, then to back up your arguement you like studies from two right wing think tanks and 3 opinion pieces from rightwing authors.

    Well done!

  24. @Colin

    Did you seriously just describe the Heritage Foundation as a “left leaning outlet”?

    I rarely trust what any media outlet has to say about academic research, and think tanks are universally biased. Journalists, by and large, don’t have the time or education to properly understand and then distill research into a 500 word article. Just go to JSTOR or Google Scholar and read the recent literature yourself without self-selecting the titles that support your preconceptions. Pulling a single “Harvard study” that agrees with you is not an intellectually honest way to try to understand a complex issue like the gender wage gap. It doesn’t tell the whole story, the same as the superficial 79 cents-on-the-dollar statistic.

  25. I think Ben just threw this topic into the arena so all the crazies could slither out of the jungle and bash each other; for the enjoyment of the silent majority. Thank you, Ben. Very Well Played. I heartily approve!

  26. This is such a non-issue, it’s amazing that any space is wasted on the topic. Unfortunately, that’s all we’re left with in our society. How embarrassing!

  27. I applied (male), got crazy high limit immediately (Tier 1A credit (according to the credit union where I work’s chart)). Now that I’ve had it a few months I spend 8% of the limit max when I tried to use it for everything, average 2%.

    A month later my wife (female, community property state, makes about 20% of income but has super flexible/ self employed lifestyle the permits our 4 kids the luxury of a parent at every moment of their life outside, and inside, school) applied. Same limit, immediate.

    We have a house that is half paid off, car half paid off, and student loan of 100 a month (yeah in state tuition and paying while in school!). We don’t extend where we can’t – don’t be a hero, buy what you can afford is our mantra.

    There is a data element here – my wage is self reported, as is hers. Household – same self reported number. They only know these plus current debt. They don’t know my equity other than initial balance minus current. They can guess if i sold the previous cars we paid off.

    If we are to be judged on my credit limit, I would rather be judged on my balance sheet – much more accurate! Speaking of, before my first credit line I had completed accounting 101 and 102, so the idea to me about financial statements and acid tests was built into my brain before my first gas station charge card. I wish everyone that same path- learn the math before you move the line where you are declined.

  28. Come on people. The algorithm isn’t sexist. Read and interpret what you’re reading. She’s unemployed! That’s why, jesus christ stop making mountains out of molehills. Someone wanted attention and she sure got it! The algorithm worked as it should have. Try having her go out and get a mortgage, great score and profile or not when you’re unemployed it’s just not gonna happen!

  29. Heather Rivera: I was wondering about the same thing. Did she say she was unemployed? Cause it doesn’t matter they fill taxes jointly, it’s not her income. Same with Wozniak. But talking about sexism and discrimination are much more popular these days.

  30. I believe it! I applied and received an Apple Card. I am a male though and it’s not relevant anyway, but onto my complaint……they do not like people who pay their balances off quickly. I charged and paid off over $6K the first couple of weeks before interest hit of course. I had an issue with my card when I first got it, the support via text was absolutely excellent and easy. However, after using the card and paying off promptly as stated above, I started to have transactions being rejected. When I inquired to find out why, I was twice left in a text message with no response after establishing communication with an account support person. Clearly they were trying to displease me, and they did. I closed my account and went with an Amex rewards card instead.
    So, part of their marketing was no fees, blah blah blah…..we want you to save money blah blah blah…..but the second you save money, they start treating you like crap. I blame G & S, not Apple, but Apple should know better how these big banks will treat customers in the long run.
    Killing it with my new Amex with rewards, very happy.

  31. Surely if women perform equally as well as men at only 79% of the payroll cost then every employer would fire the men, replace them with women at a cheaper rate, and pocket the difference.

    At any rate, I’m GLAD that the computer is sticking it to these silly women as revenge.

  32. @Leper…An excellent point that will be dismissed by the perpetually outraged, who argue all the time that businessmen are “greedy”, except, of course, in the case of paying men more money than women.

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