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The financial giant, Goldman Sachs has been in business for nearly 150 years, and recently they have put their money on the average citizen. After almost two centuries of avoidance, the banker of the rich has created a new program, titled Marcus. Birthed from the founder’s name, Marcus Goldman.

This service has been long awaited. The bank made their initial step, when they recruited an executive from the major credit card company, Discover, to oversee their consumer lending business. Afterwards, Goldman began a strategic plan to hire a number of employees with experience in the online lending market. A former official for the Consumer Financial Protection Bureau was recruited. This move would keep the new business venture in line.

The initial launch of Marcus will focus on providing loans to consumers that need to eliminate any credit card debt. The loans will go as high as $30,000 and will include terms, between 2-6 years and fixed interest rates.

Marcus is entering a very competitive market, when it comes to credit card debt consolidation. Some of the well-established marketplace lenders are available online. Two of those lenders is Prosper and Lending Club. Lending Club reported that paying off credit cards and refinancing existing loans make up approximately 60% of their business.

The information on Marcus’ website displays the variance of annual rates, from 6% to 23%. There isn’t any knowledge on the underwriting for the loans, but the rates will be determined by the length of the term, credit history, and credit score. A statement on the website says, “Only the most creditworthy applicants qualify for the lowest rates.” Relatively large loans offered by online lending businesses are unsecured and promote to borrowers that have good credit. This allows Marcus to offer rates that are lower than credit card companies.

Overall, Goldman Sachs’ new lending service will be similar to other online lenders, but there are some distinct advantages as well. One difference is having the money to loan. Most online lenders accumulate their money through investors, like hedge funds. Being one of the largest bankers with some of the wealthiest clients, Goldman doesn’t have to look for money from outside investors. At the same time, there are no credit cards offered by Goldman. This eliminates a potential problem of offering credit, then offering a loan to pay off the loan.

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