It was reported that Amazon is said to be linking up with JPMorgan Chase, Capital One, and other financial institutions in creating a “checking-account-like” product for its customers. The Amazon checking account will target young customers and people without bank accounts. In Creating its own checking account, Amazon would reduce fees it pays to financial institutions on every transaction and them a much closer look at customers’ spending habits.
The initiative wouldn’t result in Amazon becoming a bank itself due to the capital rules and regulations that would accompany that move, sources tell the WSJ. The checking accounts would simply be a partnership with a bank that makes the best offer.
Expanding the Amazon ecosystem
The report indicates that talks are in the initial stages and may not ultimately result in the creation of a final product. Few details are currently available about how the checking account would actually work.
However, if the plan becomes a reality, it would give the online retailer another avenue for engaging customers offline.
The company has already targeted the grocery space through the acquisition of Whole Foods Markets. It also recently targeted the healthcare space by teaming up with Berkshire Hathaway and JPMorgan Chase to form an independent healthcare company for their employees in the United States.
Amazon-branded bank accounts wouldn’t be the company’s first foray into the financial sector. Amazon already offers “Amazon Cash,” which lets customers add cash to a digital wallet and purchase items online with it.
Amazon has been trying to bring Amazon Pay to brick-and-mortar stores and is likely to begin with Whole Foods.