Marcus Personal Loans by Goldman Sachs Review
- April 18, 2017
- Posted by: Jeff Gitlen
- Category: Personal Loans
The Goldman Sachs Group recently announced the availability of an online lending platform specializing in unsecured personal loans. The platform is named for one of the company’s founders, Marcus Goldman.
Benefiting from the firm’s nearly 150 years in risk management and financial expertise, Marcus personal loans by Goldman Sachs offers consumers a simple and transparent approach to consolidating high-interest credit card debt with a debt consolidation loan.
Creditworthy borrowers can apply for a Marcus personal loan with no fees, a fixed interest rate, a loan amount of up to $40,000, and a repayment term ranging between 3 and 6 years.
According to a company representative, a straightforward personal loan is a better approach for consumers managing high-interest-rate credit cards. With Marcus Personal Loans, consumers have a much simpler alternative to credit cards, which often involve rate changes and the charging of multiple fees, an approach that can leave consumers further in debt and make it difficult to pay off their debt.
This Goldman Sachs Personal Loans Review will discuss what this decision means and how the company got to this point.
What Marcus Personal Loans Offer
5.17% - 15.96%
6.99% - 23.99%
2.29% - 36.00%
3 - 6 years
1 - 7 years
Compare Rates from 9+ Leading Lenders With One Free Application
Goldman Sachs reported that the new lending platform came about after listening to thousands of consumers who provided feedback regarding their personal experiences in debt management. The feedback received included consumers who felt stressed by sudden interest rate changes, hidden fees, and preassigned payment dates. Limited payment options were also a source of dissatisfaction among consumers. These are all elements the new platform eschews.
Furthermore, Goldman Sachs is making it possible for consumers to speak to a representative directly when they need help with their Marcus Personal Loan rather than being forced to contend with automated machines. The new personal loan lending platform features dedicated loan specialists based in the United States who offer live, personalized support.
In its first launch phase, Marcus Personal Loans will require the entry of a code sent to prospective customers in the mail. The firm has stated that the special code would be sent out to millions of consumers with a prime credit score. Feedback received from the first group of consumers will be used for refining the lending platform. Goldman will allow consumers to set their own monthly payment dates.
Interest rates on the loans offered via Marcus will remain fixed over the loan term and will range from 6.99% to 23.99%. Marcus is expected to be opened to a larger audience in the coming months.
Goldman Sachs Shifting Gears by Entering the World of Fintech
With the introduction of Marcus, Goldman Sachs is taking a definitive step into the world of fintech (financial technology). In the past, Goldman Sachs has avoided relatively small consumer loans. Historically, the well-known financial institution has served governments, corporations, and the ultra-wealthy. In the past, that approach earned Goldman the reputation of being the most elite financial firm on Wall Street. Following the introduction of new regulations in the aftermath of the financial crisis, Goldman has been forced to seek out new options for overcoming regulatory challenges and procuring new lines of revenue. Consumer banking is the cornerstone of the firm’s push into uncharted territories.
Marcus is just one way Goldman Sachs is utilizing the bank holding status it acquired because of the financial crisis. In recent years, there had been internal discussions regarding the possibility of offering retail financial services, including small business loans. Those discussions eventually resulted in the creation of Marcus, which has involved significant resources.
The firm hired Harit Talwar, a former executive for Discover, last year to begin working on the new consumer lending platform, which was designed to work similarly to online lending companies like Prosper, PNC, and LendingClub.
Goldman’s introduction of the new lending platform will also push the firm into direct competition with a host of these new alternative lending companies, such as Prosper, which have entered the financial scene in recent years in an effort to compete with traditional banks. Over the last several months, many of these new online lenders have experienced struggles simply because they are not actually banks and have been forced to rely on investor funding. That funding can be withdrawn at any time, leaving lenders vulnerable.
While there has been some speculation about whether Goldman will be able to compete successfully in the retail financial realm, which is new territory, the firm does have some advantages. Since Goldman is a regulated bank, it is able to offer greater security, as the firm has access to reliable, inexpensive cash resources from depositors. Additionally, Goldman does not have the overhead expenses of operating multiple branches around the country.
Consumers who have grown tired of playing the credit card game and are looking for an alternative to adjustable rates, inflexible payment dates, and hidden fees may find that Marcus is just the solution to help them manage their personal finances more effectively.