Amazon's latest benefit targeted to millennials reveals how terrifyingly powerful the company has become

Frazer Harrison / GettyAmazon wants to reach millennials who don’t have checking accounts — or aren’t happy with their current bank.
  • Amazon is in talks with JPMorgan Chase and Capital One about creating an Amazon-branded checking account.
  • If implemented, it will appeal to their younger demographic and customers without bank accounts.
  • Financial services are only the latest on the list of Amazon’s industry disruptions.

If millennials couldn’t live without Amazonbefore, they certainly won’t be able to live without it now.

The e-commerce giant is in talks with banking’s big leagues, including JPMorgan Chase and Capital One, about creating an Amazon-branded checking account for its customers, the Wall Street Journal reported this week.

Amazon is said to be approaching the idea as a partnership – Amazon wouldn’t become a bank, but would work with one on a product that will appeal to their younger demographic and customers without bank accounts.

Details are sparse, but the move would potentially allow Amazon to lower the fees it pays to financial firms and provide insight into their customers’ spending habits. It would also help them forge a more seamless relationship with customers.

Though these discussions are only in initial stages – it’s possible the idea may not even actualize – the tech company is no stranger to disrupting industries to reach its customers.

It expanded into grocery brick-and-mortar retail with Amazon Goand its recent acquisition of Whole Foods, and it became a television and movie production company thanks to the development of Prime Instant Video and Amazon Originals.

Meanwhile, Shipping With Amazonis turning the delivery service industry on its head, giving FedEx and UPS a run for their money. Amazon is also entering the health care insurance business in a new partnershipwith JPMorgan Chase and Berkshire Hathaway.

Financial services would just be another notch in its disruptive belt.

It’s not a bad strategy considering that, unlike generations before them, millennials judge a bank bythe quality of its mobile offerings. In fact, 92% would choose a bank for its digital services, and 30% have at least one financial product that isn’t their bank. Above all, this tech-savvy generation values low fees and flexible options, with 45% citing high fees as their main reason for switching banks.

But, that’s only for those who do have a bank – one study found that roughly five million millennialsdon’t have a checking account, primarily because 48% distrust banks.

With such a large demographic to target, and as a familiar brand with name recognitionthat may be more likely to distill trust in consumers, Amazon might be on to something.

But this isn’t Amazon’s first foray into the industry – just last year, it launched Amazon Cash, in which consumers can reload cash to an Amazon wallet, and Prime Reload, which gives customers a 2% bonus when using their debit card to transfer funds from a bank account to an Amazon balance they use for purchases on the website.

It also offers a Prime rewards credit card from JPMorgan Chase issued by Visa and has an Amazon.com store credit card from Synchrony. Not to mention Amazon Pay, which allows customers to pay for products on third-party sites without reloading credit information.

It only makes sense that a checking account would be the next step.

As Alyson Clarke, a principal analyst at the research firm Forrester, points out toMarketWatch, Amazon already has expertise in making positive and seamless consumer experiences to perfect the checking account. Doing so could create an opportunity to provide more rewards and enhance loyalty programs.

“It could be interesting and completely change the game,” she said. “Banks may need to step up on their checking accounts.”

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