The Goldman Sachs Group (GS - Free Report) is mulling to partner with an e-commerce giant, Amazon (AMZN - Free Report) , to provide loans to small- and medium-sized businesses in the United States. The news was reported by the Financial Times.
Goldman is currently working on developing technology that will enable it to provide loans through Amazon’s lending platform. Per the article, the company will start this service as early as March.
The move seems to be part of Goldman CEO David Solomon’s efforts to boost revenues through investment in new avenues such as consumer banking and wealth management. At the Investor Day held recently, the bank announced that it is aiming to become “banking-as-a-service” provider.
This is not the first time that it has entered into a deal with a technology company. In March 2019, Goldman had launched an innovative credit card with Apple (AAPL - Free Report) .
Goldman has been making efforts to bolster its consumer lending platform, and continues to build on its online bank, Marcus. Backed by these steps, the investment bank has been able to reach millions of people, despite lack of a sufficient physical branch network.
Also, these help tech giants to expand services, and cater to a wide customer base without being concerned about regulations.
While Goldman is on track to remodel its business into a more profitable one, it continues to face probes and queries from several federal agencies, and a few foreign governments for businesses conducted during the pre-crisis period. These are likely to keep costs elevated.
Shares of the company have gained around 21% in the past year compared with 7.2% growth registered by the industry.
Goldman currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A better-ranked stock in the same space is Nomura Holdings (NMR - Free Report) , currently carrying a Zacks Rank of 2 (Buy). The company’s current-year earnings estimates have been revised 42% upward over the past 30 days. Also, its shares have inched up 8.1% in the past three months.
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