Goldman Sachs’ online bank, Marcus and its new mobile application.

Goldman Sachs’ online bank, Marcus, recently launched a new mobile app that goes beyond loan payments and balance transfers. Some reviewers feel they were behind the game, which could have negatively impacted market share as Marcus faced criticism from smartphone users.

Goldman Sachs launched the bank as Marcus just over three years ago to diversify into retail banking without diminishing the well-known Goldman Sachs brand on Wall Street for investment banking. The bank offers savings accounts as well as personal loans which tend to be at higher interest rates compared to other types of traditional bank loan offers.

Personal loans are growing exponentially thanks to online competition. Goldman Sachs is primarily known as an investment bank and has no presence as a brick and mortar banking institution. The company admitted that customers requested an app for most of 2019 and spent a lot of time in development throughout the year. The bank explained that they wanted to make sure it was a top-notch application.

Even though Marcus is only a few years old, with Goldman Sachs behind it, online banking has catapulted itself into a major player in the online retail banking industry. The bank has more than $50 billion in deposit business as well as $5 billion in lending, originating from short-term personal loans.

That said, compared to the rest of Goldman Sachs, $50 billion in deposits is a very small percentage of its business. Consumer banking still has a long way to go before bringing the kind of volume to the business that investment banking does. Marcus, however, shows much more promise than his credit card business.

Credit cards may have gone too far, at least for now. As online banking has become mainstream and the Marcus brand begins to be known beyond its connection to Goldman Sachs, it will likely grow exponentially over the next two years and achieve more impressive profit margins.

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David A. Albanese