Goldman Sachs and Barclays are bidding to acquire GM’s credit card business currently operated by Capital One, the WSJ reports. Goldman is the frontrunner.
What’s the rationale? GM’s suitors are pitching the concept of cars as e-commerce portals, sources told the WSJ...so, basically, bundling credit cards, cars, and e-commerce. GM was the first major automaker to let drivers buy gas, book travel, and get their coffee fix from the touchscreen.
As connected car tech and digital payments gain greater penetration in the U.S., theoretically, the car-as-payment-portal idea could work. It sounds a bit weird to me, but hey, I don’t own a car so what do I know.
- The bull case: This idea seems especially well-suited for America, land of the drive-thru (which generates 70% of sales for some fast food chains). Personally owned cars are having a renaissance during the pandemic, while curbside pickup gets more commonplace.
Big picture: From the Apple ecosystem to GM connected cars, Goldman is looking for new digital channels to grow its nascent consumer banking business.