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Goldman launches new online lending strategy for mass affluent

July 27 (Reuters) - Goldman Sachs Group Inc is launching a new digital platform where customers of other wealth management firms and brokerages can apply for loans, the bank said on Thursday.

The platform, called GS Select, will make loans of $75,000 to $25 million using borrowers' investment portfolios as collateral.

To find customers, Goldman is partnering with Fidelity Investment's clearing and custody business, which caters to small brokerages and wealth management firms. Those firms, in turn, have investors who may need loans.

"It's a relatively lower risk marketplace but a very big market," Andy Kaiser, head of Goldman's private bank, said in an interview.

Goldman also plans to leverage relationships with outside investment managers through its asset management division, which sells its own mutual funds, structured notes and alternative investments.

Goldman is turning to third parties because as a Wall Street bank that deals with ultra wealthy investors and corporations, it does not have direct relationships with so-called "mass affluent" borrowers who have less than $10 million in investable assets. Its own wealth clients typically have at least $50 million.

Reuters first reported on the plan in May 2016.

The bank says GS Select will be able to approve and process loans in just one day, and eliminate loads of paperwork that typically accompany applications.

In recent years, Goldman has been trying to grow traditional banking businesses it has little experience with as businesses like bond trading have slowed down.

Last year, it purchased $17 billion worth of online retail deposits from GE Capital Bank. It also launched Marcus, its first major foray into consumer lending, and acquired Honest Dollar, an online retirement savings platform for small businesses and startups.

Goldman has nearly tripled its funded loans over the last four years, but its $64 billion loan portfolio at the end of 2016 is only a fraction of those of bigger consumer banks like JPMorgan Chase & Co.

Goldman's chief rival Morgan Stanley has also been trying to lend more to its own wealth clients, primarily through securities-based loans. (Reporting by Olivia Oran in New York; Editing by Lauren Tara LaCapra and Richard Chang)