One week after acquiring video doorbell Company “Ring” for over $1 Billion, Amazon has moved on to their next endeavor. The Wall Street Journal and other news outlets are reporting that Amazon is in talks with a few of the big banks about building an Amazon branded checking account for its customers. The deal won’t involve Amazon becoming a stand alone bank but rather partnering up with one of the big banks. Having their own branded bank account will help reduce Amazon’s fees that it pays to financial firms through all their businesses.
The benefit for the big banks is that it would allow them to keep a powerful competitor close and strengthening its ties to one of the most powerful companies in the world.
“The underlying goal is to further grow its Prime membership through cross-selling into existing J.P. Morgan customers and this could lead to more initiatives down the road,” Dan Ives, chief strategy officer and head of technology research at GBH Insights, told CNBC in an email. “Ultimately, Amazon is in fifth gear, trying to double down on the consumer and the finance vertical looks like the next step (through partnerships) of adding to the Amazon flywheel.”
Last year, Amazon got into the grocery business with their $13 Billion purchase of Whole Foods. Last month, it was reported that Amazon is trying to open their own delivery service in direct competition to UPS and FedEx. They have already made some noise in the healthcare field. Now, they’re trying to make their mark in the finance field, though more as a partner than a direct competitor.