With Marcus Adding Checking, the Biggest Digital Disruption for Banks Could Actually Come From Goldman Sachs

As previously reported, Goldman Sachs recently launched the Marcus app through its online retail banking entity with the same name. Soon the Marcus App could be more powerful than previously anticipated as the bank goes beyond the lending and credit card business. Goldman Sachs has announced plans to offer digital checking accounts through a smartphone.

Eric Lane of Goldman Sachs stated, “We aspire to be the leading digital consumer bank. We’re starting with loans, we added savings and cards, and we’re working to build out the balance of the digital products suite, including wealth and checking.” The company also plans to add wealth management at zero fees through Marcus, unabashedly looking to add every feature of a retail branch through a mobile device.

The company plans to add financial tools to its app, and replace the need for a retail brick and mortar bank entirely, making a bet that most consumers will be comfortable with this approach. Goldman Sachs may be right, as there are countries such as the Netherlands where there are almost no bank branches left of any form and only ATMs. Even the ATMs tend to be shared by the largest banks in that country and by individual banks. Younger consumers are comfortable making major decisions with little to no human interaction.

A digital checking account will likely help Goldman Sachs upgrade banking clients to other services. Under the Marcus brand, the company has featured short term interest loans and business loans. However, with the latest push, the bank will likely compete for more mainstream home mortgage loans. While checking accounts are not planned until 2021, the wealth management features will come out later this year.

A bank spokesman stated that Goldman Sachs wants to double its consumer deposits to $125 billion within 5 years and up to $900 million in pretax income.

In essence, Wall Street’s most famous investment bank is looking to own the retail banking industry without opening a branch. It would not be wise to bet against Goldman Sachs.