Not content with handling your shopping, Amazon wants to be the one offering you the account that pays for those purchases.
Jeff Bezos is slowly but surely pushing Amazon into an ever-more diverse range of business sectors. The latest of those being through the acquisition of Whole Foods. But it seems the next target isn’t about selling goods, it’s about handling the money customers use to pay for things.
As The Wall Street Journal reports, Amazon is thought to be in talks with a number of the large banks, including JPMorgan Chase, regarding offering Amazon-branded checking accounts. The focus is apparently on younger customers; Amazon wants to target them specifically with these accounts. For now, these are early stage talks as Amazon explores what’s possible.
Amazon already offers a Prime Rewards Visa card in conjunction with Chase Bank USA. Using one to pay for purchases nets the customer up to 5 percent back in rewards, which can then be used for more purchases on Amazon. The rewards were recently extended to Whole Foods store purchases in a bid to get more Prime customers into the stores.
It’s easy to see how a similar rewards scheme could be offered for a checking account, and Amazon would link the best rewards to being a Prime member and spending money in its stores. Targeting young customers increases the chance of loyalty in the long term as not many of us take the time to look for a better bank once we are setup with one. It also means more potential for a steady flow of new, young Prime subscribers.
The WSJ makes it clear Amazon isn’t considering becoming a bank itself due to the capital rules and regulations that come with it. This would purely be a partnership, and one just like selecting a new headquarters. Amazon will ultimately choose to partner with a bank that makes it the most enticing offer.