The Wall Street giant on Wednesday played up its customer service skills, saying that representatives of its Marcus personal-loan unit answer calls within 10 seconds.
Sure, personal loans have a long way to go to catch up in market share with other forms of consumer credit, but millennials are relying more heavily on them than their Gen X predecessors while paring back on credit cards and mortgages. Online lenders are a big reason, and banks are exploring ways to adjust to changing habits.
The $2.6 trillion-asset bank's recent commitment to digital lending augurs the development of a two-tier market for borrowers who want fast access to cash.
In a move to strengthen the PayPal Working Capital program, the online payments giant has agreed to acquire the small-business capital lender Swift Financial.
The largest banks are approving small-business loan applications at the fastest rate since the recession, a sign that that they are willing to assume more risk and taking seriously the threat of competition from online lenders.
Young businesses often prefer banks, especially community banks, over online lenders. However, traditional lenders need to make quicker decisions, simplify the application process and make other improvements, these customers say.
The online consumer lender reported a net loss of $25.4 million, bringing its red ink in the five most recent quarterly reports to more than $200 million.
