Amazon is reportedly talking to potential banking partners about creating a credit card with rewards points for small businesses to use specifically on its website to purchase items like office supplies and industrial machine parts, people with knowledge of the matter told Bloomberg.
An Amazon spokesperson declined to comment on the news to Bloomberg. The report further stated that Amazon is talking to multiple banks, including JPMorgan Chase, which already partners with Amazon on a consumer credit card, about developing a co-branded small business card.
Amazon may see a dedicated small business credit card as a gateway to offering small businesses other types of financial products and services, such as insurance, the report stated.
If a report of Amazon potentially partnering with Chase on a banking product sounds familiar, that’s because it was just one week ago that a separate report emerged suggesting that Amazon was talking to Chase, among others, about creating its own consumer checking account offering.
While Amazon didn’t comment on either of these reports, it wouldn’t be a surprise at this point to see it pursue either or both efforts. According to a recent LendEDU study, customers are ready to trust Amazon with their bank accounts, insurance and other financial services. Also, the e-commerce giant has been rumored to be looking into expanding its current financial products and services, which already include co-branded consumer credit credit cards, Amazon Pay, Amazon Cash and Amazon Lending.
In fact, under Amazon Lending, the site’s marketplace merchants have accepted billions of dollars in financing from Amazon over the last several years, so many businesses may be similarly comfortable with the idea of buying on credit with Amazon, especially if rewards are in play.
For Amazon, small business credit cards for use on its site only would be another powerful lure for businesses to look to Amazon for their supplies, equipment and parts, rather than dedicated business product retailers like Staples, or specialty B2B retailers. That’s also where Amazon’s interest in banking and payments products overlaps with another of its apparent long-standing interests — broadening its reach and influence in the B2B sector. That interest has become increasingly apparent with moves like last fall’s launch of Prime memberships for businesses.
At one point last year, there was some buzz about the possibility that Amazon could consider buying Capital One. Also, Amazon late last year registered three cryptocurrency-related web domain names, which seemed like a possible precursor to launching its own cryptocurrency.
Well, Amazon hasn’t acquired a bank yet, and it hasn’t launched its own version of Bitcoin yet, so not everything that Amazon is reported to have interest in, or even clearly invests in, becomes core to the e-commerce giant’s strategy in reality. Yet, Amazon has also built a legacy of success by forming strong bonds with customers through data. Earning a spot in their wallets is a great way to do that.