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This is how Goldman Sachs’ ‘scoring’ works, which has unleashed the controversy

The launch of the Apple Card was a success, as well as the reception by users. However, the first doubts are emerging around it. Some users have reported various incidents with the card when granting credits. On multiple occasions Apple Card has offered a lower credit to women than to men apparently on equal terms as they are married, have similar economic activities in even higher salaries than women on some occasions.

Apple Card and credits, the origin of the controversy

It all started last Thursday, when David Heinemeier Hansson published on Twitter a series of tweets explaining how Apple Card gave him a limit 20 times higher than the one he gave his wife . David Heinemeier Hansson is an influential developer and current CEO of Basecamp, so his tweets have had enough impact. David claims that the two have been living together for years, that they make the tax return together and that his wife, despite paying on time the credit received, still does not get more until the next billing period. In short, he believes that the algorithm behind the Apple Card credit is sexist.

This is how Goldman Sachs’ ‘scoring’ works, which has unleashed the controversy
This is how Goldman Sachs’ ‘scoring’ works, which has unleashed the controversy

As he explains, he contacted Apple’s customer service on several occasions, although they were unable to resolve the question of why his wife’s credit was inferior . Finally, after the media repercussions of his tweets , he indicates that his wife’s credit is now equal to his own. They have not given him any explanation as to why they have suddenly uploaded it to his wife and when he has contacted customer service again, the employees indicated that “We don’t know why, but we swear that we don’t discriminate, it’s simply the algorithm”.

Following the tweets of David Heinemeier Hansson other users have also made public their complaints about similar treatment , where the woman received a lower spending limit than the man. For example, one user shares that his wife has an income four times higher but receives a credit 10 times lower than he does. Another explains that his wife has a higher scoring and higher monthly income but still receives only a third of the credit granted to him through the Apple Card. Of course, there have also been a few users showing how his wife has received a slightly higher credit by living together, with a similar scoring and doing her taxes together.

How Bank Scoring Works

As we know, the Apple Card is a credit card and not a debit card, therefore, the user can receive money borrowed in advance . But why these abysmal credit differences in some cases? It all depends on banking scoring and how the credit system works in the United States (and generally around the world).

Before continuing, it is necessary to remember that here there is a second involved that has not been mentioned until now, it is the bank Goldman Sachs . As we know, Goldman Sachs is Apple’s ally and takes care of the financial part of the Apple Card, while Apple provides the technology. That is, everything related to the credits granted, loans and limits of these depends on Goldman Sachs, while Apple is responsible for the integration with the iPhone, the app Wallet and more. Being Apple the one with whom the card is contracted and having its name on the card, users will obviously turn to Apple when faced with a problem.

Going back to the bank scoring , this is a score given by each bank or financial institution to each person to see how “reliable” they are in granting a loan. This score depends on many factors as indicated by FICO, such as each person’s monthly salary, past payment history, whether they have outstanding payments, the stability of their current job… In short, any type of factor that can determine whether or not a person is able to pay back the money borrowed on time. The person’s gender should not really be one of those factors, however, because of the cases mentioned above it may give the impression that it is.

Exactly how Goldman Sachs’ scoring works is something only Goldman Sachs knows. This feature is not made public because it might enable someone to deliberately adjust the conditions of scoring to trick you into getting a better score. Something similar happens with Google’s search algorithm for example, which is secret so that no one can take advantage of it to position your website better in the results. In other words, only Goldman Sachs knows why David Heinemeier Hansson is given 20 times more credit than his wife.

This is precisely what has angered David Heinemeier Hansson the most. He indicates that after speaking with several representatives of Apple and even Goldman Sachs they have all given him a similar explanation. This explanation comes from the fact that they don’t have the capacity to analyze what the algorithm has decided to grant a credit or another to each person. In a way it makes sense, it is a secret algorithm as we have indicated before.

But of course, as our colleagues in Xataka indicate, the question arises as to whether there is blind faith in the algorithm without knowing exactly how it works, because that algorithm too could be being fed by automatic learning and not only by the parameters that Goldman Sachs is giving it. It would not be the first discriminating machine learning algorithm. However, this is speculation of Basecamp’s CEO because of how they have acted from Goldman Sachs to the situation, as there is no way to know how exactly the algorithm works.

In XatakaLa Apple Card in the face of sexism and controversy: the algorithm is accused of giving a man 20 times the credit of his wife

The reactions of Goldman Sachs, Apple and others

David Heinemeier Hansson y Bloomberg

Apple en Instagram


Compartir Así funciona el sistema de ‘scoring’ de Goldman Sachs que ha desatado la polémica de Apple Card



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Temas de interés
As we have seen, David Heinemeier Hansson’s review has had a memorable impact. In response to this criticism, Goldman Sachs has issued an official statement explaining that the credit granted to each Apple Card user is independent and does not depend on who each person is married to. They also clarify that no decisions are made based on factors such as a person’s gender.

On the other hand, Apple has not made any statement on this matter for the time being. There is no official statement from Apple regarding this problem that some Apple Card users are having. From Apple we have contacted Apple Spain to see what their position is on this issue, we will update the article if we get a response.

In AppleApple Card and the new Wallet: Questions and answers from the most disruptive credit card of all

Finally, regulators in New York have warned that they have initiated an investigation into the matter. In a statement, a spokesperson for the New York City Department of Financial Services said the department is conducting an investigation to ensure that all consumers are treated equally, regardless of gender. He said: