Amazon is in talks with JPMorgan Chase and other financial institutions to build out a co-branded checking account according to the WSJ. JPMorgan Chase would be the obvious choice given that the issue the co-branded Amazon credit card, Synchrony would be another option as they issue the Amazon store card. Chase does offer consumers checking accounts already (offering bonuses of up to $300 to sign up for a new account) whereas Synchrony only offers savings products (CDs, money market accounts and general savings accounts).
Amazon isn’t interested in becoming a bank, they are more interesting in make sure potential customers can shop on Amazon. In particular they want to target millennial’s and unbanked customers. I could see there being some integration of Amazon’s new cash load feature and a potential checking account for those who are unbanked although the main issue with those who are unbanked is that there is usually an underlying reason as to why that is the case and traditional lenders such as Chase as unlikely to be able to solve that problem with a standard checking account. Amazon also already offers people loading funds to their Amazon balance via a checking account a 2% bonus, but you’re better off using a credit card to earn 5% cash back instead.
This could potentially be a good thing for our hobby, Walmart has also previously see unbanked customers as an opportunity and that led to partnerships with American Express for prepaid products. At this stage I wouldn’t be getting too excited though.
Hat tip to reader Abey & Chris W
