Credit card

CFPB probes Goldman Sachs credit card operations

Goldman Sachs said Thursday (August 4) that it was cooperating with a Consumer Financial Protection Bureau (CFPB) investigation into its credit card business.

In a regulatory filing on Thursday, the investment banker said the CFPB investigation looked at Goldman’s “credit card account management practices, including with respect to applying refunds, crediting unpaid compliant, billing error resolution, advertisements and reporting to credit reporting agencies.”

Related: Goldman adds GM as 2nd major co-branded card

The Wall Street giant offers two credit cards through partnerships with a pair of big companies: its Apple Card, launched in the summer of 2019, and another card through General Motors, which was introduced earlier this year.

It was unclear which of the two cards was the focus of the investigation. Apple, GM and the CFPB were not immediately available for comment Wednesday.

Last week, PYMNTS reported that Apple’s move into the buy now, pay later (BNPL) space caught the attention of CFPB Director Rohit Chopra, leading to a review of the wider implications. of big tech companies entering the lending space.

Read more: Apple’s move into the BNPL space raises alarm bells at the CFPB

The CFPB examines the “implications of Big Tech entering this space” and considers several questions, including whether Apple Pay Later could “reduce competition and innovation in the marketplace,” Chopra said.

See also: Goldman Consumer Banking revenue rises 25% as loss reserves rise 497%

The Goldman investigation comes — as PYMNTS noted last month — at a time when Goldman Sachs is broadening its appeal to retail banking customers, emphasizing digital channels to fuel retail business. savings and loan.

Those efforts appeared to pay off in July when the bank announced consumer and wealth management revenue of about $2.2 billion, up 25% year-on-year. ‘other. Meanwhile, Goldman’s traditional bread and butter, investment banking and asset management, saw drastic year-over-year declines.

The company’s results show $12 billion in credit card loans on the books, down from $11 billion in the first quarter and from $5 billion a year ago. Installment loans were $5 billion, down from $4 billion in the first quarter and $3 billion a year ago.



About: Results from PYMNTS’ new study, “The Super App Shift: How Consumers Want To Save, Shop And Spend In The Connected Economy,” a collaboration with PayPal, analyzed responses from 9,904 consumers in Australia, Germany, UK and USA. and showed strong demand for one super multi-functional app rather than using dozens of individual apps.