Goldman Sachs in talks with Amazon to offer small-business loans

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Banking partnerships could help Amazon “significantly extend” its small- and medium-sized business lending platform, an analyst said.
(Reed Saxon / Associated Press)
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Goldman Sachs Group Inc. is close to striking a deal with Inc. to offer small-business loans to its U.S. customers as the Wall Street bank turns to Big Tech to extend a push onto Main Street.

Goldman has begun building technology to facilitate the offering of loans to small- and medium-sized businesses over Amazon’s lending platform, according to two people briefed on the discussions with the online retailer. The project could launch as soon as March, one of them said.

Goldman, which declined to comment, has been transforming itself from a trading and investment banking powerhouse into a broader financial services group that more closely resembles rivals JPMorgan Chase & Co. and Citigroup Inc. David Solomon, Goldman’s chief executive, told shareholders last week that the bank would boost returns by generating revenue from new sources such as consumer banking and wealth management.


For Amazon, a Goldman deal would be in line with CEO Jeff Bezos’ push to turn the company into an infrastructure provider that profits from a growing chunk of online trade by charging for a host of commercial services offered to other companies.

John Cronin, an analyst at brokerage Goodbody’s, said banking partnerships could enable Amazon to “significantly extend” its small- and medium-sized business lending platform “without any associated credit risk of regulatory obligations.”

Amazon declined to comment on the Goldman talks but said lending was one of the services provided to “our selling partners, mostly small- and medium-sized businesses, who account for more than half of everything sold in Amazon’s stores.”

Amazon has already expanded far beyond its origins as an online bookseller by building businesses that sell cloud computing space and use of warehouse facilities to a variety of companies.

It had outstanding small-business loans of more than $863 million on its own balance sheet at the end of 2019. For the last eight years it has lent to small businesses that sell on its site, using the data it holds on their cash positions to offer quick-decision loans in a handful of countries.

Last year Goldman struck a credit-card partnership with Apple Inc., which featured the bank’s branding on the physical card and in some marketing and gave Goldman a direct channel to Apple’s more than 100 million U.S. iPhone users.


Executives at Goldman, which lacks the physical branch network that most banks use to attract small- and medium-sized business customers, have described the Apple Card as the “most successful credit card launch ever.” Card lending is known to account for a significant portion of the $7 billion of consumer loans and card balances the bank had at the end of last year. Goldman also offers consumer lending in the U.S. through Marcus, its retail banking arm.

Goldman’s new consumer ventures accounted for less than 3% of revenue last year, while the cards and consumer loan balances at the end of 2019 were less than 1% of its $993 billion in total assets.

At its recent investor day it said it would pursue “banking as a service” this year, which involves allowing third parties to put their own branding on a bank’s products.

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