Goldman Sachs’s client base has traditionally comprised of the elite and the big. But now the Wall Street giant is looking to appeal to the average Joe in the US, and it has spared no expense in its attempt to make Marcus, its online consumer lending platform, appeal to a wider society that has been wary of Big Finance since 2008.
Indeed, from the clean-cut website to the emphasis on “straight talk” and “transparency”, there is no doubt that Goldman has taken pains to tap into this borrower base.
Marcus’s launch also comes at an opportune time in the marketplace lending industry — macro and sectoral volatility from the first half of 2016 are driving larger platforms to diversify their funding models, while smaller platforms are bracing for consolidation.
But Marcus, with its loaded balance sheet, doesn’t have to think about funding, and more importantly, it can offer borrowers what other platforms cannot afford to do — no origination or late fees. That could prove a win-win for Marcus and its customers.
By combining what seems to be cutting edge lending technology with cheap funding, Marcus is, in theory, the perfect guise for a bank seeking redemption — and business — from its new target consumer base.
But Marcus needs to run as perfectly as the firm’s blurb suggests it will. Average Joe is more vulnerable to the consequences of the sort of murky practice that allowed convicted ex-Goldman worker Fabrice Tourre to perpetrate fraud than the company’s traditional clients.
There is nothing to say Marcus will be anything other than a reputable business for mom and pop borrowers, but a recent Harris poll suggests it is Marcus’s parent which has the reputation problem. Bad conduct haunts some of the Street’s biggest names to this day. It is to be hoped Marcus marks a new way of doing business in more ways than one.