Amazon Gives You Credit
Amazon has combined brainpower with Synchrony Financial to devise a new credit card that gives out-of-reach customers a second chance on their credit score. Keep talking…
There isn’t much Amazon can’t do alone, but on this occasion, the tech giant is tapping into the experience of Synchrony Financial with retail credit cards. The retail banking firm is driven by co-brands with other names like Lowe’s and PayPal, who have also felt the push to start a credit card. Why?
Amazon wants anyone (and everyone) signed up as a loyal customer, and it usually gets what it wants. However, surveys by the FDIC have suggested that a quarter of US households may be underbanked, and some, according to Tom Quilden of Synchrony, will “always be out of reach because we just can’t give them credit.” Such folks are ruled out of an Amazon loyalty card. Until now. Amazon is trying to scoop up those lost leads by allowing them to rebuild a credit rating within the Amazon bubble.
Here’s how the Amazon Credit Builder card works. Users buy a couple of hundred dollars’ worth of Amazon products with their credit, and if they pay off the debt then they graduate to the standard Amazon Store Card. Until then, Amazon’s covering its backside by ‘securing’ the cards with deposits equal to the credit limits. Cards like these are popular among industry insiders, despite not improving “real-life” credit ratings. Industry analyst, Ted Rossman, went out of his way to call this a “solid option” for those with bad credit. Now, investors are watching on to see how many customers can be gathered up through with this opportunity for a second chance. Good on you, Amazon.
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