Goldman Sachs Group Inc is launching a new digital platform where customers of other wealth management firms and brokerages can apply for loans, the bank said on Thursday.
The platform, called GS Select, will make loans of $75,000 to $25 million using borrowers’ investment portfolios as collateral.
To find customers, Goldman is partnering with Fidelity Investment’s clearing and custody business, which caters to small brokerages and wealth management firms. Those firms, in turn, have investors who may need loans.
“It’s a relatively lower risk marketplace but a very big market,” Andy Kaiser, head of Goldman’s private bank, said in an interview.
Goldman also plans to leverage relationships with outside investment managers through its asset management division, which sells its own mutual funds, structured notes and alternative investments.
Goldman is turning to third parties because as a Wall Street bank that deals with ultra wealthy investors and corporations, it does not have direct relationships with so-called “mass affluent” borrowers who have less than $10 million in investable assets. Its own wealth clients typically have at least $50 million.
Reuters first reported on the plan in May 2016.
The bank says GS Select will be able to approve and process loans in just one day, and eliminate loads of paperwork that typically accompany applications.