Amazon moves to replace JPMorgan for co-branded card portfolio
Multinational tech company, Amazon is reviewing bids to replace American multinational investment bank JPMorgan Chase & Co. as the issuer on its popular co-brand credit card.
JPMorgan is willing to part with the Amazon portfolio, Bloomberg reports; meanwhile, American Express and Synchrony are among the bidders looking to replace JPMorgan Chase as the issuer of Amazon’s co-branded credit card, Bloomberg and Reuters reported. Amazon and JPMorgan first issued a joint card in 2002 and their offerings have long operated on the Visa Inc network.
The rising competition for new card customers have prompted financial institutions to load up their cards with rich perks, making it harder for lenders to turn a profit, especially in the world of co-brand cards where revenue is often shared with the merchant partner.
Presently, JPMorgan’s Amazon card comes with a lucrative set of rewards. This includes offering the e-commerce giant’s Prime members 5% cash back on purchases made on its site and at its subsidiary Whole Foods Market, making it the fastest-growing portfolio among the top 10 co-brand card programs in the U.S., according to a 2019 study by Packaged Facts.
Statistics from Packaged Facts further reveal that cardholders spend more than $50 billion a year on the card, hence, JPMorgan could fetch a 15% premium on the portfolio, which contains more than $15 billion in loans.
Bloomberg shared that it wouldn’t be the first time Amazon has worked with other credit-card issuers. The retailer already offers a card with AmEx that’s targeted at small-business owners. The firm has also long partnered with Synchrony on its private-label card and the two debuted a secured card together in 2019.
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