Nearly $1 billion in deposits were made into Apple's new savings account in the first four days.

According to two sources familiar with the matter, Apple's recently launched high-yield savings account brought in almost $1 billion in deposits during the first four days, with the account gaining nearly $400 million on launch day alone. The account's 4.15% annual return, which is significantly higher than the average bank's rate of less than 0.5%, coupled with the widespread use of iPhones, is likely the main reason for the high volume of account openings. Roughly 240,000 accounts were opened by the end of the launch week. The account is offered through a partnership with Goldman Sachs Bank USA, and it outperforms Goldman's own high-yield savings account, which offers a 3.90% return. Apple and Goldman Sachs declined to comment on the deposit and account figures.

Richard Crone, the CEO and founder of payments firm Crone Consulting, notes that traditional banks have not increased their deposit or savings account rates for savers, despite responding to the Fed's interest rate hikes with higher mortgage and car loan rates. As a result, there is an outflow of funds to CDs, money market funds, and fintechs like Apple.

First Republic Bank is the latest financial institution to fail due to shaken confidence in the industry, and it has been acquired by JPMorgan Chase, including $92 billion in deposits. Goldman Sachs, on the other hand, is rapidly attracting consumer funds by tapping into Apple's 2 billion iPhone owners. The new savings account is only available to holders of Apple's credit card, Apple Card, and clients can open a savings account in less than one minute directly from their iPhone. Apple Card spend rewards, called daily cash, are automatically directed into the high-yield account. Clients can track their balance and interest earned from a dashboard integrated with Apple's digital wallet. Before the Apple savings account, daily cash rewards were automatically deposited into Apple Cash, a prepaid digital card issued by Green Dot Bank.

In the wake of the Fed's massive interest rate hikes, many traditional regional banks are struggling to maintain net interest margins, and as a result, few have matched Apple's 4.15% on FDIC-insured savings account rate. Numerous digital banks, including Bask Bank, Current, Varo, and LendingClub, offer high-yield products with annual returns ranging from 2% to 4.75%. However, Apple and Goldman's edge is likely their seamless user experience and iPhone integration.