It can often be difficult for people with bad or no credit history to get access to credit. Amazon is looking to get more people to use its rewards cards, even those who don’t have the facility of credit, which is why it has teamed up with Synchrony Financial to launch the Amazon Credit Builder.
A large segment of the U.S. population could be able to take advantage of this new credit product. A 2018 FICO survey revealed that over 11 percent of the population has a credit score of under 550. The survey also mentioned that 4 percent of the population has a score between 300 and 499 which is classified as “bad credit score.”
Synchrony Financial, a publicly traded bank, will be working with Amazon on this new credit product. It will lend to shoppers who don’t have good or any credit history, customers who would otherwise not be able to get Amazon’s loyalty cards.
Customers will get many of the same perks that the popular Amazon Store card offers. This includes 5 percent cash back on purchases (for Prime members). Some of you may already know that Amazon’s Store card is also powered by Synchrony.
It will also provide financial literacy tools so that customers can learn about building credit. They will eventually be able to move to an unsecured Amazon credit card once they have demonstrated the capability to pay back the loans.