Goldman Sachs CEO says its online lender has already hit $1bn mark

By Ryan Weeks on Wednesday 21 June 2017

Alternative Lending

Lloyd Blankfein explains the rationale behind Goldman’s decision to launch online lending platform Marcus.

Lloyd Blankfein explains the rationale behind Goldman’s decision to launch online lending platform Marcus.

In an exclusive interview with CNBC’s Jim Cramer, Goldman Sachs’ CEO Lloyd Blankfein (pictured) shed light on the progress of the firm’s online lending project. Blankfein said that the platform has already lent more than $1bn, and that he expects it to have crossed $2bn in loans by the end of the year.

Much of the discussion on Marcus revolved around the need to give Goldman – a bank typically associated with the very largest companies and the richest people – a more human face. Blankfein said that Marcus, which is named after the bank’s founder Marcus Goldman, fulfilled “an important business purpose, but also an important social purpose”.

Marcus makes loans to consumers of between $3,500 and $30,000 in size. In March, search marketing intelligence firm AdGooroo revealed that Marcus had garnered 4.75 per cent of all clicks that were generated by paid-for advertising on personal loan keywords in the first few months of the year.

Blankfein told CNBC’s Jim Cramer that algorithmic approaches to risk management are very much in Goldman’s “wheelhouse”. He also said that Goldman had talked to thousands of people while developing Marcus. He explained that its users are “terrific people”, who had had a little “rain in their lives”, or “some need that came up”.

But Blankfein did not shy away from saying that Marcus would be a money-maker for the bank: “Let me be clear. This business, the way the margins are in some of the – in the way credit card balances are charged out, there's plenty of room for us to make a great return on this."

Marcus officially went live in October of last year, meaning that it hit the $1bn milestone in less than a year. That kind of growth is unprecedented within the online lending sector. Blankfein said the firm’s intention is to grow the platform slowly, to ensure that it’s doing a good job.

“But we're going to grow, you know, we're going to grow this thing,” he said. 

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