Goldman Sachs has reportedly stopped plans to launch a branded credit card for retail customers.
Reached for comment Wednesday (Feb. 15) by PYMNTS, a spokesperson for the bank downplayed the decision, saying the consumer card was something that was discussed but never a “meaningful” part of the company’s strategy.
Goldman unveiled its plans for a consumer credit card years ago, but that idea faded as the company scaled back its retail banking business, CNBC reported, citing comments from a former Goldman employee.
The decision comes amid a large shift by some big banks away from retail banking operations.
Goldman Sachs has been scaling back its retail banking operations amid one of the most sweeping reorganizations in its history. That meant streamlining the company into three divisions, one focused on investment banking and trading, another on asset and wealth management, and the third dealing with transaction banking.
As part of that shift, the company’s digital-only bank Marcus was folded into Goldman’s asset and wealth management unit. At the same time, CEO David Solomon said the firm would renew its direct-to-consumer (D2C) strategy.
“We will focus on existing deposit customers and consumers that the bank already has access to through channels like workplace and personal wealth, rather than seeking to acquire customers on a mass scale,” Solomon told investors during the company’s quarterly earnings call in October.
Last month, Goldman Sachs reported that Platform Solutions — a division that includes some functions that had been part of Marcus — lost $1.2 billion in the first three quarters of last year, $1 billion in 2021 and $783 million in 2020.
Platform Solutions includes consumer platforms like partnerships offering credit cards and point-of-sale (POS) financing, transaction banking and other services for corporate and institutional clients.
Soon after that announcement, Goldman executives said the outlook for 2023 remains uncertain on a macro level but that the company is hoping to scale Platform Solutions toward profitability.
Goldman isn’t alone in shifting away from retail banking. Citigroup announced last year it was changing its business structure as a piece of a larger strategy to shift away from global retail banking. Citi shuttered its Mexican retail banking arm, Citibanamex, and sold its consumer banks in Indonesia, Malaysia, Thailand and Vietnam to Singapore’s United Overseas Bank.
Later in 2022, the bank said it was pulling out its retail operations in the U.K. to focus more on its wealthiest clients.