Goldman Sachs continues its move into consumer finance with a new point of sale financing product, MarcusPay.
What’s going on: Marcus by Goldman Sachs has launched a new installment loan product that helps customers break up higher ticket items into smaller, monthly payments.
- Loans ranging from $750 to $10,000 are repaid over 12 or 18 months at a fixed rate of 10.99% to 25.99%, with no fees apart from interest, according to the MarcusPay site.
- MarcusPay is launching first with JetBlue Airways. Both firms are likely betting consumers will book future vacations now if they can spread their payments over time.
“During this time our number one priority is the health and safety of our customers,” Abhinav Anand, head of consumer loans for Marcus, told CNBC. The new service will enable JetBlue customers to “buy what matters to them, when it matters, and to pay for it in equal payments with no fees or upfront payment.”
Moving the needle?: MarcusPay is unlikely to garner a lot of interest, according to financial services analyst Ron Shevlin.
- A recent study by Cornerstone Advisors showed roughly 6% of Millennials currently have one or more POS loans—double the percentage of Gen Xers, and quadruple the percentage of Baby Boomers with that type of loan.
Goldman Sachs wants to double the consumer deposits it holds to $125 billion over the next five years and generate $700 million to $900 million in pretax income excluding reserves in the division.