STRATEGIC PARTNERS
March 6, 2018
Don't say you weren't expecting it …
Amazon reportedly is in talks with a number of banks — including JPMorgan Chase and Capital One — about establishing an Amazon-branded consumer checking account.
A story at CNN.com cited a Wall Street Journal report about Amazon's purported foray into retail banking services. The online giant already has an agreement with Chase for an Amazon-branded Visa card, and issues an Amazon store card through Synchrony.
At this point, not much else is known about the Amazon project, CNN said. JPMC and Capital One both have declined to comment on the reports.
Setting up an Amazon checking account through an existing bank would simplify things significantly for Amazon, which would reap brand recognition without regulatory bother.
In an emailed statement, Ryan Tuttle, senior consumer finance analyst at Euromonitor International, commented further on the potential branding benefits to Amazon:
Amazon has built a tremendous amount of brand equity which could go a long way toward extending banking services to consumers, regardless of whether Amazon itself holds the accounts or whether they partner with an established bank. Consumers have already shown a strong level of trust towards Amazon through their willingness to exchange personal data and privacy in order to benefit from its many services. Offering banking services could offer another potential avenue for Amazon to both extend its influence and learn more from its consumers.
On the other hand, while a bank could benefit financially by providing the infrastructure for an externally branded checking account, it would run the risk of subverting its own brand in doing so, and would risk possible commoditization and disintermediation with its own target consumers.
