Surging news reporter Wang Xin Yue, comprehensive coverage
E-commerce giant Amazon may launch its own checking account.
On March 5, US time, the Wall Street Journal reported that Amazon is in talks with major banks, including JPMorgan Chase & amp; Co., to provide users with a product similar to a checking account.
Informed sources to the "Wall Street Journal," revealed that the negotiations are still in its infancy, and ultimately could not be achieved. But at this stage, the focus of talks between Amazon and financial institutions is developing a product that appeals to younger users and people without a bank account. But no matter what the final form of presentation, the move will not make Amazon a bank.
And if the product finally rolls out, it will undoubtedly make Amazon more relevant to users because it affects users who shop at Amazon and Whole Foods, who use Kindle ebook readers, users of Amazon Streaming Services, and People who communicate with Amazon Artificial Intelligence Assistant Alexa.
Providing such products, equivalent to private-label bank accounts, helps to reduce Amazon's payment to financial institutions and gives Amazon access to valuable data such as customer revenue and spending habits.
With millions of customers and vast amounts of data on hand, Amazon has access to cheap capital and investors have given the company plenty of room to do business when launching new businesses, so Amazon is a strong contender.
Amazon's current market capitalization of more than 700 billion U.S. dollars has surpassed the market capitalization of JP Morgan Chase and Bank of America in the two largest U.S. banks.
In addition, Amazon has involved a number of cross-cutting business. The logistics system it builds is thought to "one day surpass UPS and FedEx," while it also targets the healthcare supplies market and is considering extending the reach further to prescription drugs. Every time Amazon enters an industry, shares of major players in the industry generally fall sharply.
But in banking, Amazon is more of a role than a partner, not a spoiler.
The Wall Street Journal report mentioned that Amazon filed a hybrid checking account with several banks last fall and is considering plans for some of the largest financial institutions, including JPMorgan and Capital One Financial Corp. There are still many details to be confirmed about this product, including whether users are able to write checks directly, whether they can pay directly, and whether they can network with the nation's ATMs. However, it is still too early to give specific answers to these details .
However, what is certain is that if Amazon runs its own banking business, it will be subject to capital rules and other regulatory rules that may limit its aggressive expansion and may face strong opposition. Wal-Mart tried to obtain a bank license more than 10 years ago, but eventually forced to give up this effort with the strong criticism of many businesses and legislators.
Sources in the aforementioned article said that Amazon has been considering promoting financial services for years and hopes to reduce the intermediate fees it pays to banks and other financial institutions. If Amazon users have an Amazon check account directly, they can withdraw cash directly for shopping, which helps to reduce part of the cost.
At present, Amazon is already working on promoting its Payments product, which is being rolled out to its own company, Whole Foods, while allowing more merchants to support this payment method.