Why Goldman Sachs Is Lending to the Middle Class

Kade Parker had never heard of Goldman Sachs Group Inc. in 2016, when a letter from the bank offering his wife a loan arrived at his house in Hornbeck, La. (population 480). The 27-year-old oil worker had recently taken a pay cut and needed to reduce his monthly credit card bills. After calling to make sure it wasn’t a scam, he says he took out a loan for around $15,000. “We were trying to move some money around, make it easier on us,” Parker says. “I told them the situation, they said no problem.” Then he got laid off, and a year and a half later he filed for bankruptcy, listing more than $135,000 in unsecured debt, including 10 credit cards and loans from online lenders SoFi, Prosper, and Affirm.

The Goldman Sachs loan came from Marcus, the online banking business the company started in 2016. Marketing to regular people was a surprising shift for Goldman, whose bankers advise on giant corporate mergers, trade for hedge funds, and manage money for multimillionaires. But Marcus has already attracted 1.5 million customers and made $3 billion in loans. It markets itself with direct mail and jokey commercials that paint the company as the responsible alternative to credit cards. Onstage at a CB Insights conference on June 20, Harit Talwar, the former Discover Financial Services executive hired to run Marcus, was reminded that Goldman Sachs was once compared to a “vampire squid” for its financial crisis dealings. Talwar said he’d like Marcus to be called a “lovable teddy bear.”