Amazon considers launching branded checking accounts for unbanked
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Amazon is reportedly in talks with JPMorgan Chase & Co., and Capital One Financial Corp., to offer checking account services to younger customers and the unbanked.
According to The Wall Street Journal, Amazon is still in the very early stages of a potential banking foray, but even if the product does see the light of day, it'll position Amazon as more of a partner rather than a direct competitor.
From the Journal's report:
Last fall, [Amazon] put out a request for proposals from several banks for a hybrid-type checking account and is weighing pitches from firms including JPMorgan and Capital One Financial Corp., some of the people said. It is too early to say exactly what the product will look like, including whether it would give customers the ability to write checks, directly pay bills, or access to a nationwide ATM network.
In other words, Amazon, a known disruptor, is not coming for the banking industry. The Journal also noted that Amazon is actually quite cozy with both JPMorgan and Capital One.
Earlier this year, Amazon and JPMorgan teamed up with Warren Buffett's Berkshire Hathaway to tackle rising healthcare costs for their US employees. JPMorgan has also issued Amazon-branded credit cards since 2002. Meanwhile, Capital One is a longtime customer of Amazon Web Services.
Nevertheless, the potential banking endeavor could be an effort by Amazon to offset payments processing costs and fees while also establishing a stronger presence in the payments industry. The e-commerce giant has been looking for ways to expand Amazon Pay to brick-and-mortar stores, likely via Whole Foods. Amazon also offers a debit card-type service called Amazon Cash, which enables shopping on Amazon without a credit or debit card, and a deposit-style service called Prime Reload.
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