Amazon puts toe in banking sector by selling student loans

Amazon Prime has added yet another item to its growing lineup of membership benefits: discounts on student loans.



The online giant is teaming up with Wells Fargo to offer Amazon Prime Student members a discount on private student loans that are taken out through Wells Fargo Educational Financial Services, the largest private student lender among U.S. commercial banks. (Membership in Amazon Prime Student costs $49 a year, which is half the price of a regular Amazon Prime membership.)



Under the agreement, Prime Student members are eligible for a 0.50% discount on Wells Fargo-issued loans. Members can also qualify for an additional 0.25% interest rate reduction by enrolling in an automatic monthly loan repayment plan from Wells Fargo.



“We are focused on innovation and meeting our customers where they are – and increasingly that is in the digital space,” said John Rasmussen, Wells Fargo’s head of personal lending group. “This is a tremendous opportunity to bring together two great brands.”



Wells Fargo and Amazon have been in discussions for more than a year about the partnership, according to The Wall Street Journal, which also reported that the two companies are not compensating each other for what Wells Fargo describes as a multiyear agreement that will reach millions of potential borrowers.