American Express Co. and Synchrony Financial are among banks bidding for Amazon’s credit card business, which is currently handled by J.P. Morgan Chase, Bloomberg reported on Wednesday (June 9), citing sources.
Amazon and J.P. Morgan launched their first co-branded Visa credit card in 2002, and the portfolio is estimated to have $15 billion in loans, according to the sources, per Bloomberg. The bank could get a 15 percent premium on top of the balance if Amazon decides to move forward with a change.
People spend more than $50 billion a year on the card, Bloomberg reported, citing a Packaged Facts study.
J.P. Morgan is prepared to step away from the Amazon portfolio, sources told Bloomberg.
The numerous cash-back rewards and other perks make it tougher for lenders to make money. In a co-branded situation, revenue is typically shared with the merchant partner, Bloomberg reported.
The J.P. Morgan Chase Amazon card offers Amazon Prime members 5 percent cash back on good bought on its site or at Whole Foods. Among the top 10 co-branded cards, Amazon’s portfolio is the fastest-growing, according to a 2019 study by Packaged Facts, per Bloomberg.
Amazon already partnered with AmEx to extend cards to small businesses. The eCommerce giant also has a partnership with Synchrony on its private-label card and a secured card launched together in 2019, according to the article.
Citi and AT&T have renewed their co-branded credit card partnership and are making moves to increase customer engagement and develop more products. Synchrony and Sam’s Club have teamed for a co-branded card. Goldman is in talks with JetBlue to take over its card portfolio.
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