Goldman Sach’s fintech story

Goldman Sachs (GS) is a torch bearer in the investment banking space with a long standing history.

Over the years though, trading division provided for chunk of its revenue and net profit; 75%.

After the 2009 financial crash, trading division income started to dwindle.

While other commercial banks like Citibank and JP Morgan were accepting deposits from public and had a retail footprint, GS lacked a presence here.

To overcome this, GS forayed into the retail space in a strategic move to diversify revenues in 2016.

GS leveraged its brand name and balance sheet strength.

Enter Marcus- a neo bank, a fintech that addressed the pain points of users.

– tapped into the young millennial tech savvy crowd and lured them with 4x high deposit rates 

– personal loans offered at low interest rates to repay other high interest debts

– partnered with Apple to launch apple card and acquire 100 million iphone customers

– expanded in to UK in 2018 and ended up with 5L customers by end-2020 

Now, retail revenues account for ~10% of total revenues and GS aims to have a loan book of USD20bn and consumer deposits of USD125bn by 2025.

This story leaves us with a seed of thought to evolve, extend our skill set and step up our offering game, isn’t it? 

#fintech #strategy #bank

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Ramnath Sundar
Articles: 19

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